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What are the qualifications for a short sale?

The main qualification for a short sale is that you owe more on your home loan than what your home is worth. Secondly, you must be suffering some sort of financial hardship. Many lenders have dropped the required hardship explanation, however. Financial hardship can include many things, such as:

  • Loss of employment or reduced hours
  • Major illness or medical expenses
  • Divorce
  • Increased bills
  • Higher living expenses
  • Investment Loss
  • Changing loan terms
  • Concerning loan terms/High interest rate
  • Inability to save for retirement
  • Increased anxiety
  • While some lenders do not require a hardship explanation, other lenders will require at least some explanation of why you cannot pay your mortgage. Our experience is that ALL lenders have very lenient rules about what they consider to be a hardship. Give us a call at 1-866-923-2568 and we can discuss what type of hardship requirements your lender has, and what you can do if you think you do not have a valid hardship.

    A common misconception about short sales is that you have to be out of money to qualify. Having cash savings in the bank, or even situations where you are currently making more money than you have in the past will not necessarily disqualify you from a short sale.

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    Other Common Questions

    California Association of Realtors

    Important Notice

    The Mortgage Forgiveness Debt Relief Act expires at the end of this year. Don’t get caught paying tax penalties by waiting to short sell. Click here to learn more.


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