Short sale properties must be approved by the lender, attorney (if an attorney is representing the lender), or probate court judge (with lender approval).  Lenders generally approve a short sale if foreclosure is inevitable due to financial hardship & not enough equity in the home to pay off the mortgage.  Hardships are defined as: death of sole income provider, divorce, unemployment, bankruptcy or medical emergency.  This assists the homeowner by allowing them to sell the property for less than the outstanding mortgage (short) so it does not go into foreclosure which is permanent on their credit record. The process for obtaining the lender’s approval can take 3-5 months and once they issue the approval letter the property can be sold.

The property is sold “as is” meaning the lender will not do any repairs unless they pertains to safety (electrical, plumbing) but they will not replace roofs, fix pool filters/pumps/screens, install a new AC, etc.  Because of this some buyers like FHA or VA don't apply since both loan types have strict rules & regulations regarding inspections & repairs.

Listing Agent for Short Sale:

Add the Short Sale addendum approved by FAR BAR in the Dalton Wade templates (under Common Addenda). The listing agent must mark the listing as a “short sale" in most MLS’.

-The short sale listing price may not reflect market value.

-Property may be priced below market comparables (CMA).

-When seller accepts the offer – the listing agent will send the listing agreement, executed contract, buyer pre-approval/proof of funds and earnest money deposit to the lender.

-Short sale process can be delayed if the package is incomplete and/or missing documents.

-Buyers may wait 90-120 days for a response from the lender.

–Checking with the lender at least once or twice a week is imperative!

For more information on Short Sales you can reach out to your board or the Florida Realtors Organization at:  www.floridarealtors.org