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Will lenders consider a short sale when the mortgages are current?
A Realtor recently asked me an excellent question: As a Realtor, I'm representing a seller of a home with a first mortgage and a second mortgage. While both mortgages are current, the sum of both mortgages exceed the value of the property. Will lenders consider a short sale when the mortgages are current?
My response:
The short answer is a resounding "yes".  The lender will consider a short sale even if the borrower is current, the question is how will that impact the final terms of the short sale.
A very important and early disclosure is warranted here. Short sale Realtors and buyers should never counsel sellers to stop making their payments. That is a decision sellers need to make wholly on their own or upon consultation with a lawyer.
If the borrower has the financial strength to make the payments, the lender will be more likely to require the borrowers to stay obligated on the shortage.
If the borrower anticipates being unable to sustain the payments in the future, they should clearly state that in their hardship letter.
I have lost count how many loans and short sales I have negotiated, somewhere over 200 by now. I have never encountered ... more

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