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Short Sale Scenario:

We are purchasing a short sale. Our offer was accepted by the seller.  We have now learned that our offer exceeds the amount that the sellers owe on the property.  Will the bank now be removed from the process?  Can this continue as a traditional sale?   
  • June 03 2014 - Easton
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Answers (5)

There could be a 2nd Mortgage.  I am just completing a transaction where the 2nd mortgage will be short but all other items will be paid
  • June 04 2014
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The best thing to do is to look at the settlement statement to see if the offer amount will not only payoff the loan but also cover the title fees, taxes, real estate commissions, etc. Good luck!
  • June 03 2014
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Thanks for your responses! 

To Jacqueline- We believe our offer will cover the mortgage, the fees, and the ccosts.  Our strategy was that we didn't make an offer to get a bargain, we made an offer based on what we felt the market value was, because it was important to us to secure the property. So we believe we might have covered all, or most of the associated costs. 

Eric-  I'm hoping you're right!  We would love to avoid the long haul if possible....we will soon find out via attorneys for our bank.  

 
  • June 03 2014
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A  short sale is a sale of real estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property, and the property owner cannot afford to repay the liens' full amounts and where the lien holders agree to release their lien on the real estate and accept less than the amount owed on the debt. Any unpaid balance owed to the creditors is known as a deficiency.

Even though the bank now will be paid in full, with all the real estate fees and sales cost, will the current price clear all the sales cost?  If not, does the Seller have enough funds to pay off all the cost incurred to sell his or her home?
  • June 03 2014
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As long as the sellers are able to clear title by paying off the liens on the property, then it should be a normal sale.  The attorney representing you or the bank will be researching title. I would talk to the attorney involved and ask them about if this will be a short sale or not.  Good luck!

Eric
  • June 03 2014
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