It was almost a year ago that Bank of America approved a short sale on one of my Destin Florida condo listings. The sale price at the time was $260,000. The sellers owed $410,000 on the unit. Bank of America approved the short sale requiring the sellers do a cash contribution of $16,000 towards the loss at closing. Why? Because the sellers were paying two other mortgages on time and they had jobs and regular income.
Unfortunately, the property did not close. The buyer defaulted after approval because he wanted to buy another condo.
Six months later I found a new buyer. The Destin condo market had declined further, so the sale price was much lower. Five months later still, I got the short sale approved by Bank of America. Although little has changed with the seller’s circumstances, the investors on this loan were much more lenient the second time around.
Property: Destin Florida condo
Ownership type: Investment
Sale Price: $211,000 (one year ago- approved price was $260,000)
Mortgage Balance: $410,000
Cash from seller: -0- (one year ago- $16,000 cash contribution was required)
Promissory note from seller: -0-
Needless to say, the sellers are delighted. The question remains, though, why were the investors more lenient with short sale approval terms the second time around? Not only did they accept $50,000 less – they required no cash contribution from the seller. This may mean investors are loosening up their approval guidelines in general, cutting their losses and moving forward. It may be good news for homeowners in trouble who are considering a short sale.
Wendy Rulnick, Broker, CRP, CRS, GRI, ABR Rulnick Realty, Inc.
Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204
Email Wendy: [email protected]
Wendy is a short sale and pre-foreclosure specialist and has been featured in “Kiplinger Personal Finance Magazine” and “Florida Realtor Magazine”. Call Wendy Rulnick, Broker/Owner,to list and sell your home or condo on the Emerald Coast of Florida in Walton, Okaloosa and Santa Rosa County- Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.