Short Sales: Why Would a Bank Issue an Extension on a Short Sale Approval Letter?

Real Estate Agent with RE/MAX Action
IL – The most likely reason why a bank would accept to issue an extension on a short sale is because the bank prefers to do the short sale over the foreclosure. This is a reason why your agent needs to continue to tell them on why the short sale will be beneficial during the entire process. Click here to discover how other sellers successfully did a short sale and avoided foreclosure. The biggest reason a short sale is beneficial is because banks usually make 10-20% more on a short sale compared to selling a property after foreclosure. Besides, the further out the foreclosure date is, then the more beneficial the short sale. That is because the bank gets to sell the house today, rather than 12-18 months down the road. The savings can be quite substantial when you sit down and add them all up. Doing a short sale and selling the property now makes more financial sense for the bank than a foreclosure. An extension to the closing date of a short sale is a major request for the bank. Not every bank will accept such a request. Here are some steps you may take to increase your chances that the short sale bank will accept to give you the extension: * Present a guaranteed closing date. You need to be ready first, and then ask for the extension. This means that the buyer's lender has approved the loan and will be ready to fund once the short sale approval is extended. * Sign an addendum extending the closing. The short sale lender may want assurance that all parties to the short sale transaction are still interested and ready to close. Sending an addendum to the bank that is signed by all sellers and buyers proves that everyone has agreed to the extension. * Submit an updated preapproval letter and / or proof of funds from the buyer. You need to show the bank that the buyer is still qualified and ready to close by submitting an updated preapproval letter. Do not assume that the letter you submitted at first will serve the same purpose. * Be professional and treat the negotiator with respect. Explain the reasons behind the delay and assure the negotiator of the date by which you will close. Do not demand the extension. * Be prepared to pay for the privilege. An extension by the short sale bank is a privilege, not a right. Some banks might charge the buyer for every day they run past the original closing date. That fee could be $100 a day or more. The buyer needs to be prepared to pay if they can't close on time. Thinking about a short sale? I can help you short sale your property and get back on your feet. Send me an e-mail at I will contact you for a free consultation. When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (847) 338-0180 Discover how other sellers successfully completed a short sale and request a free consultation by clicking here. Thinking about a loan modification? Our loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy. Thanks for reading this, Dennis Toomey. Dennis is a Real Estate Broker at RE/MAX Action. Short Sales Realtor: Phone: (847) 338-0180. For Real Estate that's hassle free, just pick up the phone and leave it TOoMEy! View My homes for sale at Dennis Toomey specializes in loan modification assistance and short sales in Elgin Illinois. Elgin Loan Modification Help, Elgin Short Sales. Elgin Short Sale Realtor IL Short Sales. Realtor. Copyright 2011 SFI Marketing Institute, LLC. All Rights Reserved. Important Notice Dennis Toomey, RE/MAX Action, and the Stop Foreclosure Institute are not affiliated in any way, shape, or form with the government. Our services have not been reviewed or endorse by the government or your lender. Most lenders willingly work with agents on short sales. Why? Because most short sales are beneficial to a lender. If you accept our offer to help you on a short sale, your lender may not agree to a short sale or to modify your loan. We do offer a loan modification kit. However, the likelihood of negotiating a modification is like everything else in life. It takes work and persistence to convince your lender to modify your loan. No matter what you or we do, your lender may not approve a loan modification. We do not recommend that you stop paying your mortgage, because this will cause damage to your credit and could cause you to lose your home. Because we know avoiding foreclosure is so important to any homeowner, we recommend that you speak with the appropriate legal or tax advisor before making any decision. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. You have the option to reject a short sale or loan modification from your lender if it does not meet your approval. If you decide not to go thru with the short sale, then you do not have to pay us our fee. We normally make a real estate sales commission for helping you on a short sale. The views expressed here are Dennis's personal views and do not reflect the views of RE/MAX Action. This information on Short Sales: Why Would a Bank Issue an Extension on a Short Sale Approval Letter? is provided as a courtesy to our viewers to help them make informed decisions.

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