Last week I discussed the first few reasons why a Lender would reject your short sale. The Lender could reject a specific offer, or an entire short sale. Of course, every situation will be very fact specific, so if you are seeking a short sale in Southwest Florida, I urge you to speak with a licensed Realtor (Kristen Pell) and licensed Florida Attorney before you fall too far behind and a foreclosure action is brought by your Lender.  Here is my continued blog with further reasons…

Seller Doesn’t Qualify.

If the seller is seeking a cancellation of debt, the seller will have to explain why they can no longer afford to pay back the shortfall amount. If a seller has a good job or money in an account, the Lender could deny the short sale unless some sort of contribution is made by the Seller.  Also, you will need more than a poor housing market to blame for your hardship. This is another area where having a short sale attorney would be very important.

Inaccurate, Missing, Inaccurate Documents

As many realtors’ can attest, this causes a lot of hold-ups in the short sale process. The documentation a Seller submits, maybe the most important ingredient to a successful short sale. In a Lenders mind, by agreeing to a short sale, they are doing you a favor. In exchange, you must prove that you indeed can no longer afford the property and it’s in everyone’s best interest to allow a short sale to proceed. This is done by submitting pay stubs, tax returns, financial statements, P&L’s, budgets, bank records, and a heart wrenching hardship letter.

Keep in mind that Lenders are notorious for misplacing or losing document, so the Seller should not get frustrated if asked to produce documents more than once. Lastly, in this day in age, with the advent of MERS and the securitization of debt, after considering a short sale and entertaining some offers, some Lenders have come to find that they no longer own the subject loan, and as such, they have no authority to accept a short sale offer in the first place.

In conclusion, a short sale is a very important undertaking that should not be taken lightly. There are serious tax implications, high dollar deficiency judgments, and the new bankruptcy code that all must be analyzed to determine the right course of action. If you are falling behind on your mortgage payments or facing a foreclosure in Southwest Florida, you should speak to a licensed Florida Attorney.

This is a generalized discussion on short sales in Florida and is not intended for any particular set of facts. By no means does this blog create an attorney-client relationship or privilege between the Attorney and the readers. If you would like schedule a free consultation, or have any questions, comments, or suggestions on upcoming topics, please comment below or email GuirguisLaw@gmail.com.

The Guirguis Law Firm, PLLC
1423 S.E. 16th Place, STE 204
Cape Coral, Florida 33990
239.573.9939 Telephone
239.603.9939 Facsimile

Posted on June 27, 2012, in Legal and tagged , , , , , , , , , , , , , , , , . Bookmark the permalink. Leave a comment.

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