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Guest

I have a second home, that I was renting that I can know longer afford. It has been unrented for 4 months and I am depleting my savings. I have been making the payments but will be difficult to continue. I have a+ credit right now and have a job. Will A morgage company accept a short sale from me even though I am not completely distressed?

jenkin7 · Posted: Sat Nov 21, 2009 12:27 am Post subject:

Hi alucas,

You may not be completely distressed, but you can longer afford to stay current on the mortgage payment. You do not have enough income to make payments on both your primary home and the second home. This should be reason enough for you to request for a short sale. Though it is a different story if the lender will accept a short sale, but you should at least try and convince them to allow you to short sell the property. In case the lender does not approve a short sale, you can go for a deed in lieu of foreclosure.

gmakerley · Posted: Sat Nov 21, 2009 12:55 pm Post subject:

agreed...but what you'll have to do to accomplish this short sale is to demonstrate to the lender what the value of this property is. you made no mention of value in your post, only speaking of income/expense and assets.

value is the critical element in a short sale, the lender must be engaged to make that determination.

Guest

Thanks for responding to my email. I bought the condo for $220,000 and I owe 180,000. The mortgage company has been receiving interest only payments from me for almost 5 years. There are currently other short sales listed for the same condo priced at 129,000 to 135,000.

jenkin7 · Posted: Mon Nov 23, 2009 2:18 am Post subject:

Hi alucas,

Since you have been making interest only payments for the past 5 years, the principal amount of the loan has not reduced much. If you still owe $180k and the house is expected to be listed at something around $135k, there will be an approximate deficiency of $45k. You will be liable for this deficiency and the lender can come after you to recover it. It is not certain if the lender would accept a short sale of the property with a deficiency of $45k. But you should at least talk to the loss mitigation department of the mortgage company regarding the short sale and see if they approve it.

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