So, if you find your dream Short Sale Listing you should discuss these 10 questions with your agent before he/she writes you an offer:
8) What is the nature of the hardship? Make sure the sellers have a legitimate hardship that the bank can use to approve their short sale. Most lenders have published list of hardships that they require to approve a short Sale which includes Job loss, medical emergencies….etc. Having a New baby does not qualify for a hardship!
9) Are there damages to the property? Have the sellers filed an insurance claim for any damages!? Some sellers file insurance claims and don’t use the money for these repairs. If these repairs are require as part of your Short Sale transaction, the lender will NOT pay for them and could decline the Short Sale. If the Home Sellers have collected funds for these damages from the insurance company, the Short Sale lender will require the sellers to disclose what has happened to these funds. If the answers are a Hawaii trip; it could go to viability of their hardship and lead to a decline of Short Sale request.
10) How about Bankruptcy? Are they considering it?
Filing for a Bankruptcy would stop the Short Sale process till a decision is made by the bankruptcy judge on the liquidation of Assets. So, if seller of the property has filed for bankruptcy, keep looking for OTHER properties while keeping an eye on this one. Click below if you want to find out if you qualify for a Short Sale.