It is understandable to have questions when coping with a new and challenging situation, especially when your home and financial future is at stake.

The reality is that millions of homeowners across the country are finding out that they have more questions than answers when it comes to short sales. At times like these, you need assistance from a local short sale specialist who can help you evaluate your options and choose the right solution.

Whether you are a homeowner who just lost employment, went through a divorce, lost a tenant, or experienced any other financial setback, a short sale may be the right choice. However, it is not always the case.

As a Utah expert short sale real estate team, we will provide you with non-biased advice regarding your situation. We will listen to your needs and draw on my knowledge and our extensive past experience in dealing with short sale transactions. We will help you isolate truth from myth and get you on the road to recovery.

When a short sale is the best option, we will assist you in creating the right strategy associated with the sale of your home. We will guide you through the entire process and answer any and all of your questions. We will be there every step of the way.

The information on this page will help you better understand the short sale process. 

How Do I Qualify For A Short Sale?

In order to qualify for a short sale, the homeowner must have the following:

  • Financial hardship
  • Monthly income shortfall
  • Insolvency

What Is An Acceptable Hardship?

Amongst others: loss of job; business failure; death in the family; severe illness; divorce; job relocation; medical bills; military service; payment increase or mortgage adjustment; insurance or property tax increase; reduced income; separation; and incarceration.

How Do I Write A Hardship Letter?

A hardship letter is an important part of the short sale package and is required by most lenders before considering your short sale request. The hardship letter must relay your current situation in a factual and concise manner and can be typed or hand-written. You must state what your hardship is and how you’ve dealt with it. All borrowers on the loan must sign and date the letter. Please click here for a sample hardship letter.

Why Do Lenders Accept Short Sales?

It is more beneficial for lenders to do a short sale rather than go through foreclosure. In most cases, the loss the bank takes is significantly lower in a short sale. Foreclosure proceedings are expensive for lenders and take much longer than the short sale approval process. Banks are not in the real estate business. They are in the lending business. Their goal is to recover as much money as possible and as quickly as possible. Contrary to popular belief, the banks do not want your home.

Can I Do A Short Sale On My Own?

Although there is no law preventing homeowner from doing a short sale on their own, it is a common practice to seek the assistance and guidance of a qualified realtor when embarking on such a complex transaction. There is simply too much at stake for an average person to handle it on his own.

Who Pays Real Estate Commissions In A Short Sale?

Real estate commissions are a part of settlement expenses paid by lenders.

What Are Common Mistakes In Handling A Short Sale?

  • Selecting the wrong short sale realtor to handle your transaction
  • Overpricing or under pricing the property
  • Submitting an incomplete short sale package to lender(s)
  • Accepting an offer from an unqualified buyer
  • Submitting multiple offers to the lender(s)
  • Having unrealistic expectations

Are There Any Income Tax Implications Stemming From A Short Sale?

Contrary to popular belief, the deficiencies associated with both short sales and foreclosures are treated as debt forgiveness by the lenders and, more importantly, by the IRS. Debt forgiveness is essentially a form of income that may result in additional tax liability unless the borrowers are exempt under Mortgage Forgiveness Debt Relief Act of 2007. Click here for more information about debt foregiveness from IRS. Extended for a limited time!


The big difference between a Short Sale and Foreclosure is this:

A Short Sale - you sell your home - ending the hardship you are facing.
A Foreclosure - you lose your home - only to face the agony of a financial deficiency.


Short Sale Myths

A short sale can be an excellent solution for homeowners who must sell and owe more on their homes than they are worth. Unfortunately, a number of myths about short sales have developed, and it is important to understand the reality of this process should you find it meets your current needs.

Myth #1 – The Bank Would Rather Foreclose than Bother with a Short Sale

This is one of the most common misconceptions. The reality is that banks do not want to foreclose on your property because the foreclosure process is incredibly costly. Banks, investors, and even the federal government have all publicly stated that if a person is qualified for a short sale, the deal needs to be considered. Overwhelmingly, banks receive more on their investment through a short sale than a foreclosure.

Myth #2 – You Must Be Behind on Your Mortgage to Negotiate a Short Sale

While this may have previously been the case, today lenders are looking for verifiable hardship, monthly cash flow shortfall, or pending shortfall and insolvency. If you meet these three requirements and believe that you soon may be unable to afford your mortgage, act immediately. Any delay could limit your options. Do not wait until the countdown clock to foreclosure has started and you have even less time left.

Myth #3 – There is Not Enough Time to Negotiate a Short Sale Before My Foreclosure

This is a myth that probably hurts homeowners the most. Many do not realize that foreclosure is a process, and that there is time to make decisions that may result in better outcomes.
The foreclosing party—in most cases a lender—can stall a foreclosure up to the final day of the process. Today, many lenders may stall a foreclosure with as little as a phone call from you explaining that you are trying to sell, and almost all lenders will stall a foreclosure with a legitimate contract. For real estate professionals who understand foreclosures and short sales, there is time available until the foreclosure process is complete. However, taking action and not waiting until the last minute gives you a much better time to successful complete your short sale.

Myth #4 – Listing My Home as a Short Sale is an Embarrassment

It is understandable to have reservations about letting the world know that you owe more on your home than it is worth. However, according to recent estimates, more than one out of eight homeowners in the U.S. is in the same situation. You are to be congratulated for admitting you need help, taking action, and finding a professional who can work with you toward a solution. With recent estimates showing 40-60% of U.S. sales will be short sales or foreclosures, you are not alone.

Myth #5 – Short Sales are Impossible and Never Get Approved

This is a complete falsehood. Are short sales more difficult to execute? Yes. Do you, as a homeowner, need to learn about a new process? Yes. Are they impossible? Absolutely not. While there are no guarantees in any transaction, more and more short sales are being approved regularly. This is far from an impossible process.

Myth #6 – Banks are Waiting on a Bailout and Not Accepting Short Sales

You may have heard this, but the reality is that banks (and the U.S. government) are trying to do anything they can, within reason, to avoid foreclosing on properties. It is preposterous to believe they would deny a short sale in hopes that some future legislation would pass and pay them for losses.
Today, more banks are aggressively pursuing short sales and working with agents who understand how to process them.

Myth #7 – Buyers are Not Interested in Short Sale Properties

This is a myth that potential sellers hear all the time. Thankfully, this is just not true. In fact, many agents are getting calls from buyers who say they only want to look at foreclosure and short sales. For buyers, short sales and foreclosures have become synonymous with “good deals.” More specifically, international buyers are targeting these properties. Listing with an experienced agent who is educated in the short sale process will provide you with a great chance of quickly seeing a contract on your property.

Short Sale – A Dignified Alternative to Foreclosure

When a mortgage becomes unaffordable, avoiding foreclosure becomes a primary goal. It is a unique situation that adjusts priorities and changes perspectives. For the millions of homeowners unable to make their mortgage payments today, there are alternatives to foreclosure that can lead to an entirely different, more positive financial outcome. One of the leading solutions to foreclosure today is a short sale.

What will happen If I do nothing? 

If you do nothing and are not making your mortgage payments, your lender will foreclose. You will have a foreclosure on your credit report.

I'm "upside-down" in my property. Can I do a short sale?

Yes!! You need to have some sort of hardship, here are some qualifying hardships that we see :
Mortgage rate adjustment
Increase in monthly expenses
Need to move (home is too large or too small, too far from work, etc.)
Reduced Income
Health issues
Separation or Divorce
Medical Bills
Business Failure
Business cutbacks or downsizing
Death of a Spouse
A reason you are unable to make your mortgage payment

I have friends, and a relative in real estate. Can they do this short sale for me?

Although there are a lot of agents out there licensed to sell your property there is no guarantee that they are qualified to do a short sale transaction. Actually, most agents DO NOT know how to complete a short sale and unless they are experienced and have a proven system to get it done you simply are not getting the proper representation. We are a professional team of short sale experts with the time, patience, and understanding as well as a system to get this deal done and we even accept referrals from other agents to do their short sale deals!

I cannot afford to make any repairs…

We sell all of our properties As-Is and require the buyers to sign an addendum stating that seller will make no repairs to the property.

When should I list my home? 

If you have stopped making payments, you should list your home immediately. The Lender typically will not stop or slow down a foreclosure unless a property is listed for sale by a licensed real estate agent. 




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