Profile picture for runjlc1

Upside down

Due to poor school systems my family needs to relocate. We spend $8000 a year on private schools and that will soon become $13000 a year. Before the downturn our house was appraised at $370000 now it's $245000. $244 is what we owe but our realtor says we might be lucky to get $220,000. We don't have any $ in the bank to cut the deficit. Any advice on how to improve our situation. We would love to move.
  • June 27 - Baltimore
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Answers (3)

Profile picture for RealtorinVAMDDC
So sorry you're in this situation.

Banks grant short sales for 2 reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.

A few examples of a hardship are:



  • Unemployment / reduced income
  • Divorce
  • Medical emergency
  • Job transfer out of town
  • Bankruptcy
  • Death
The seller will need to prepare a financial package for submission to the short sale bank. Each bank has its own guidelines but -- with the exception of Wachovia, which is the best short sale bank in the world the basic procedure is similar from bank to bank. The seller's short sale package will most likely consist of:

  • Letter of authorization, which lets your agent speak to the bank.
  • HUD-1 or preliminary net sheet
  • Completed financial statement
  • Seller's hardship letter
  • 2 years of tax returns
  • 2 years of W-2s
  • Recent payroll stubs
  • Last 2 months of bank statements
  • Comparative market analysis or list of recent comparable sales
Hope this helps :)

  • June 30
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I would speak with your bank's short sale department and a couple of local realtors. They should be able to guide you in the right direction. You may want to consider renting in your desired area for a while if you do move forward with the sell of your home. Best of luck to you!
  • June 29
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Profile picture for wetdawgs
That's a very difficult situation to be in.  

In order to qualify for a short sale, you have to demonstrate to the lender that you've had a financial hardship.   Being underwater alone is not enough, loss of income, death, medical issues etc do work. Here's a link to an article about qualifying for a short sale.

If you don't  have the money for the difference, you may consider taking out a personal loan for the difference and renting for a few years to bounce back financially.

  • June 27
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