California Short Sale Rules-
Do You Know the 3 Qualifiers for a Short Sale?
California short sales refer to a real estate transaction whereby the current lender(s) agree to allow the owner to sell the property for an amount less than the current mortgage.
California short sale rules are the determining factor of whether or not you can qualify for a short sale. Not all homeowners qualify for a short sale. The current lender(s) will request several items in order to evaluate each file, but there are three short sale rules that should be present in order to determine right away if a household qualifies:
1- There must be a financial hardship. A hardship is something that has happened, is happening, or is soon to happen that will effect a homeowner’s ability to continue making their mortgage payment. This event will have happened between the time the loan papers were signed and today. Some possible hardships include but are not limited to the following:
- Military Service
- Reduced Income
- Too Much Debt
- Job Relocation
- Medical Bills
- ARM loan adjustment
- Business Failure
- Death of Spouse
2- Negative is actually positive when qualifying for a short sale as there must be a monthly shortage of money. The lender will request a financial worksheet to be completed and submitted. The worksheet will itemize ALL monthly expenditures including the current monthly mortgage payment (s). While seemingly difficult, this step is actually very easy as the lender uses the following equation:
monthly income – total monthly expenses = negative cash flow
3 You must be insolvent. Insolvency to then lender means that you do not have the means to pay down your mortgage and you have more debts than you do cash or assets. If you have small reserves of basic living expenses you will not be disqualified; however; the lender will verify to make sure you do not have assets that would allow you to pay your mortgage(s) either now or in the near future.
While a short sale can seem intimidating, the process is really quite easy and effective as long as the qualifications are met and as long as you are rely upon an experienced professional in order to negotiate your short sale. MIDAS REALTY GROUP is both experienced and knowledgeable in the successful negotiation of short sales. Most importantly, there is never a cost to the homeowners that rely on our experience and credentials.
If you or someone you know is in need of the relief a short sale can provide, please contact our office now for a FREE consultation at 800-546-2289. If you are browsing this information outside of business hours, complete the free evaluation request to the right and a professional experienced in short sale negotiations will contact you ASAP.
Why Call Midas Realty Group?
Many loan officers and Realtors say they know a lot about short sales, but don’t know how to the short sale process works or even why a short sale is a better alternative to a foreclosure. A short sale is an extremely important transaction that should be handled by a trained and experienced professional. By achieving the designation of CDPE (Certified Distressed Property Expert) and as a Realtor® that has successfully closed Orange County short sales, as well as short sales in the counties of Riverside, San Diego, Los Angeles, and San Bernardino, our broker has the training and the experience you need in order to guide you through this process. Your first step is a phone call to discuss your situation and to evaluate your available options. You may complete the information to the right and an experienced short sale negotiator will contact you to discuss your options, or you may call us now 800-546-2289 to discuss your unique situation.