The Unknowns You Face as a Seller in a Short Sale

The Unknowns You Face as a Seller in a Short Sale

When you are selling your home in a Short Sale, there are a lot of questions that you want answered. There are no guarantees on how a Short Sale will turn out, but when you are working with an experienced Short Sale Agent you will at least get the lay of the land and get a feel for the direction their Short Sale will likely take, and what issues they need to investigate further. Here are some unknowns that I address with potential Short Sale Sellers:

SHORT SALE BANK(S): Will the bank(s) approve the sale? How long will it take? Will they issue a deficiency judgment or require cash at closing? Most of the financial questions can be foreseen by an experienced Short Sale Agent when they go over your income and assets with you. And an experienced Short Sale Agent will not only know the time lines each bank typically needs for approval, they will also know how to keep the process from stalling.

BUYERS: This is one that not a lot of Sellers think about, but the one that drives Short Sale Listing Agents batty. Buyers. Are they going to be there to hold up their end of the deal when you give them the approval letters, or will they have moved on? An experienced Short Sale Agent knows how to tell when a buyer is not willing to wait for your property. They will be able to give you guidance on how to make sure you are in a transaction with a buyer as serious about the home as you are about selling it. Still, things happen. Buyers get cold feet, get denied financing and sometimes vanish into thin air.

TAX LIABILITY: Whether or not you will have a tax liability on the forgiven mortgage debt you can largely figure out yourself by reading the Mortgage Debt Forgiveness Act. Virginia, unlike some states, follows the federal guidelines so if you qualify for tax forgiveness federally, you will qualify at the state level. If you may be facing tax consequences, your Short Sale Agent will know that at your first conversation and give you names of tax professionals you can speak with.

The unknowns in a Short Sale are never going to be crystal clear, but if you start the process by hiring an experienced Short Sale Agent, you will know that you have the best shot at a desirable outcome.