Do I have to be Behind on my payments for a Short Sale?
That's the Million Dollar question these days. MANY people think they HAVE to miss 2-3 months payments in order to be considered for a Short Sale. Well....yes, that was the case a year or so ago. Infact, awhile back, when you called your bank, that's what the person on the other end of the phone TOLD you to do. BUt in the SHort Sale world...things are changing Everyday!?
Again, it ALL depends on your bank! You need to prove a definite HARDSHIP (loss of job, loss in salary, relocation for a new job, health issues, and upside down in your home), the bank is not willing to lose money, just because you want to buy a larger home for less money with a better interest rate. (THAT'S called a Stratigic Short Sale....meaning you go ahead and buy another home before your credit is bad, then just stop making payments on your old home- and ask for a short sale, because you can't afford to make both payments!? BANKS DON"T LIKE THAT- they aren't stupid) IF you can foresee that you eventually will not have the funds to continue to make your payments, (and your financial worksheet shows that), they will consider a short sale...again, it all depends on your lender.
I've just closed a couple short sales with the seller being current on their mortgage and they were successful short sales. SOMETIMES the bank will ask you to come to the table at closing with money ($3-10,000?!?!) If you show that you DO have a large amount of money in savings, etc, That's a small price to pay, to be forgiven $100,000-200,000 of your debt! You may even be able to pay if off in a period of time, with no interest. Every bank is different!
Your credit will only be dinged 50-100 points if you stay current, compared to missing 2-3+ months of mortgage payments, where it could go down 200+ points.
CALL a Realtor that is Educated about Short Sales. I have a database of Realtors Nationwide, if you need a Good Referral Agent in your area. I am a designated CDPE Realtor (Certified Distressed Property Expert).
Jeannette KOhlhaas - Keller WIlliams Realty JAX
"A Straight Shot to a Successful Closing!"