Temecula Shortsale: Will I Qualify?

Shortsales are increasing as the housing market continues to decline. Shortsales in Temecula are all over the MLS and you'll be able to find them easily in an MLS search. If you look closely at these ads you'll notice something common in all of the remarks "Sale Subject To Lender Approval". Those 5 words can be the kiss of death for many buyers and sellers. What this statement means is the price and all terms may not be what is represented in the MLS. It also leans the mortgage company may not approve the shortsale at all. When this happens everyone concerned has wasted days and even weeks of negotiations before the bank not so respectfully declines. So why bother with shortsales in the first place if they are just a path to frustration? The possibility of a great deal will keep many buyers waiting with their fingers crossed, hoping they're offer is accepted. But this doesn't have to be. Sellers and agents can easily if not a little underhandedly get the golden ticket, "Approval from the Mortgage Holder."

First, in order for a seller to qualify for a shortsale, they must show the Mortgage Holder there is a hardship. I'm not talking about owing more on your home than it's worth, there are many people out there is the same situation. What I mean by a hardship is a change in circumstances that has lead to the sale of your home that will preclude you from making up the difference. This can be a loss of job and you can no longer afford the house payment, maybe an illness that forces you to sell. Whatever the case may be you have to prove this to the bank. Providing documentation to substantiate the hardship will be required.

Things that may lead to a denial of a shortsale include, false statements on the initial loan application. If you used equity to purchase another home you may not be approved. There are many situations where your lender may not fully approve a short sale and actually force the seller to contribute some funds as compensation for the lender in order for the sale to go through.

If you find yourself in a situation that may result in a shortsale, a knowledgeable real estate agent can be a huge asset. By taking the proper steps in the shortsale process you're more likely to get the results you need with as little hassle as possible.