Tip 24-2011: Short Sales Last Minute Issues

(Short Sales Last Minute Issues) 

There are already enough problems with obtaining a successful short sale.  Some of the issues are convincing the short sale lender that the contract price is acceptable based on an unrealistic BPO, keeping the purchaser interested during the unreasonable time required to negotiate a short sale and dealing with the actual investor or MI company and their demands for additional contributions.

Now there seems to be a group of new problems which can occur during the actual closing.  The Short Sale Approval letter normally requires a final HUD to be reviewed and approved prior to the actual settlement.  The short sale lender always reserves the right in their approval letter to change their mind and revise the actual expenses allowed from the sales proceeds.
This final HUD approval can sometimes take 48 hours or more.  When the approval comes, the short sale lender could say they are not going to pay the prorated real estate taxes or termite bill, which have been previously allowed.  All of a sudden, at the last minute, there is a $350 expense which needs to be paid by the Seller (who unfortunately has no money).
The best advice is for everyone involved with the short sale (both realtors and the Purchaser) to be prepared to assist with these last minute changes.  The Purchasers needs to be reminded to be flexible as they may need to contribute some additional money to finalize a successful short sale (and presumably an excellent deal.)
Unfortunately these last minute changes are just part of a short sale and should be anticipated.  A short sale without any last minute issues is rare.  Remember, we all need to be flexible and understanding as a successful short sale is a benefit for the entire Central Virginia real estate community.

Please contact our firm if you have questions or need legal advice.

Senior Partner

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBLaw.com
www.TGBLaw.com

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About Charlotteville Personal Injury Attorney

Personal Injury attorney helping people injured in automobile, truck or mortorcycle accidents.
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