What are some of the important short sale requirements? | Tucson ...

Even though Tucson short sales can be beneficial for all parties involved, remember that a seller needs to qualify for a short sale beforehand. Unless the seller meets all four requirements as discussed here, chances are that their property will not qualify for a short sale.

The market value of the home has dropped

At the end of the day, short sales are still a financial decision, and have to make financial sense. Comparable sales have to verify that the home is no longer worth as much as the unpaid balance that is still left.

A mortgage in or near default status

Even though times have changed a bit, (lenders do consider a short sale ? even if payments are current), Tucson short sales still have a better chance of being accepted once in default. The reason that lenders accept mortgages that are nearing default is because they are eager to avoid future problems.

Financial hardship

If the seller has fallen on hard times financially, they have to submit a letter of hardship. This letter explains why the seller is unable to pay the difference that would normally be due upon the sale. This information needs to include why the seller will or has stopped making monthly payments.

Things that do NOT constitute a hardship:

• Moving out ? If you are planning to move, this is considered a lifestyle choice, not reason enough to abandon payments on your current home.

• Pregnancy ? Starting a family or increasing the size of your family (thus needing a bigger place) does not constitute a hardship.

• Buying another home ? Just because you bought another home that you think is more suitable does not constitute a hardship.

• Neighbor problems ? Even if the area has attracted some ?undesirables,? this does not constitute a hardship.

• Bad financial decisions ? Spending money on frivolous purchases does not qualify as a hardship.

Things that do constitute a hardship:

• Sudden illness / medical emergency

The seller has no assets

Even though the lender is likely to want to see a financial statement or tax return, if the seller can prove they are unable to pay the shorted difference, Tucson short sales have a better chance of being accepted. Even if the seller does have assets, a short sale may still be accepted. However, the seller may be required to pay back the shortfall. Remember, while many parties may profit from short sales, the seller is not one of them.

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Source: http://www.blasshomes.com/what-are-some-of-the-important-short-sale-requirements/

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