However, not all short sales are in foreclosure. Indeed, many people apply for a short sale when they have a financial hardship that is imminent and they are still current on their payments. Divorce, lay off, job transfer, and illness are all short sale reasons that can be imminent. You do not have to wait until the hardship has actually arrived to apply for a short sale. Indeed, I am seeing an increase in potential short sale sellers who want to remain current on their mortgage but they are applying for a short sale now before they fall behind. Often high wage earners, or those with significant assets feel that they must miss payment to drive home the issue of financial hardship to a lender and they then consequently drive their home into pre-foreclosure. However, contrary to popular belief, you do not have to miss payments to qualify for a short sale. You should explore the possibility of a short sale before you are in default.
Santa Maria Real Estate: Tips for Buying Santa Maria Short Sales
1) Be prepared for an “as-is” purchase. Many times there is deferred maintenance on short sale listings. Often owners in financial distress stop performing maintenance on the home either willfully and because they lack the funds. You can ask a short sale seller to make repairs, but often they are unable or unwilling to do so since they are losing their home. You can also approach the short sale lender and ask that they allow the cost of the repairs to be deducted from their “net” but often the answer will be no, even if the repairs are required by your lender in order to originate your new loan.
