Welcome to part 2 of our series, 'Short Sales In Palm Beach County- What You Need To Know. If you have not read Short Sales In Palm Beach County Part 1 then please take a moment to read the first in this series.
Just because you own a house in Palm Beach County Florida and you have found out that you owe your lender more money than what a buyer is willing to pay for your property does not mean you are going to be able to just sell your house for less than what you owe your lender.
You must pass the Hardship Test. There must be a good and provable reason why you can not keep your home any longer.
The Hardship Test: Ask yourself these questions and look at your situation to see if it will pass the hardship test.
- Have you lost your job since you bought the house?
- Did you have a bad accident or illness in which you got hurt and could not work?
- Do have large new medical bills that you incurred since buying the house?
- Have you been relocated to another city or state?
- Has your interest rate gone up so much that it is now a hardship for you to pay your mortgage?
Now each short sale request is looked at individually. Each situation is different. But you must be able to prove there is a hardship.
What is NOT a hardship?
If you have used your house as you ATM machine and took all your equity out of your house and are now in debt, well, that is a hardship that is going to have a tough time being accepted. I would suggest that you do what you have to do to keep your house.
If you bought your house on the tip of the market and now it is worth less than what you paid for it, that is not a hardship and not a reason to sell your house as a short sale in Palm Beach County.
The Asset Test: Do you have assets that you can liquidate to bring to closing when you sell your house short of what you owe your lender?
- Do you have money in CD's and Savings Accounts?
- Do you have equity in other properties?
- Do you have stocks and bonds?
If you have these types of assets your lender is not going to take all the loss and not have you bring some money to the closing table. They will only accept the short sale if you are contributing as well to the loss. You may be able to negotiate the loss with your lender.
The Fraud Test: Did you commit fraud when you applied for your loan for this property? This means did you lie about anything on your loan application like:
- How much money you were making?
- Where you worked?
- What your assets were?
Any of these untruths or lies, whatever you want to call them are going to be checked out by the lender. They will match up what you are saying now to what your application said when you applied for the loan. If there is a big difference than you better have a very good explanation of why the change. Losing your job obviously is a reason for the drastic change in income.
We will not list your property as a Short Sale In Palm Beach County if you committed fraud because you will be required to turn in a short sale package which we help you put together and send to the lender along with an offer and then you are exposing the fraud and that can have serious legal implications to you.
The next post in this series of Short Sales In Palm Beach County will cover the documents that you are required to put together in the short sale package. So stay tuned for Part 3.
Disclaimer: This post is not intended to be or to provide legal advice. We recommend that you speak to your attorney and your tax accountant regarding specifics and to find out if this is the best option for you in your situation.
Contact Nestor and Katerina Gasset, CIPS, Realtors®, International Properties and Investments, Inc. Licensed Realtors® in Florida at 561-753-0135 to list your property for sale or to purchase a property in Wellington, Royal Palm Beach, Loxahatchee, Lake Worth, Hypoluxo Island, Lantana, West Palm Beach and the rest of Palm Beach County Florida. We are accepting referrals.
Visit our profile to find out more about our services. Call us today at 561.753.0135 or Toll Free 800.444.3316. Contact us by email if you prefer by clicking on email me on the right side of this page under our profile.
To view all the Wellington Florida Luxury Homes For Sale Click here and then click on Multiple Listing Search where the globe is on the right side of the screen that opens up. We know Palm Beach County and will help you get your home Sold if you need to Sell your home and help you buy your Wellington Home or Land ; call us today.
P.S. If you are listing your home as a short sale in Palm Beach County Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 561-753-0135 to find out more.
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