How Time Can Run Out On Your Central Coast Short Sale

One of the worst things that distressed Central Coast homeowners do is waiting until the clock is ticking before contacting a short sale agent. When does the clock start ticking?   I tell people it starts ticking when you stop paying. Ideally, if you know a financial hardship is imminent, you should begin exploring your options, including a short sale, before any payments are even missed. In its recent Open Letter on Short Sales, the California Association Realtors reports that according to surveyed California Realtors® only about three out of five short sales close. Certainly there is much more that lenders can do to improve the process and closure rates. However, potential short sale sellers can also improve their odds of a successful short sale by acting swiftly. Some aspects of your short sale cannot be controlled by the distressed homeowner, but I believe that beginning early improves your chances.
There are plenty of stories about people living in their home without paying a mortgage for months (and sometimes years) on end. Certainly that does occur, but you really can’t know that it will happen to you. From the outside looking in it can seem like a bonus to a person in financial distress, but after interviewing people in that situation, it seems to me to be more of curse than a blessing. Typically, their credit is being drug through the mud month and after month, they can’t justify moving out until the foreclosure takes place, and their entire financial life is on hold because they are allowing the bank to decide what to do next – instead of taking charge of the situation.

Eventually, in some of those situations, people become so accustomed to living on the edge and getting extensions from the bank, that when they are finally denied an extension, they really can’t believe it. They have been lulled into complacency and panic can ensue as they realize that their home will be auctioned in less than a week. 
If you wait until that point, I do believe it decreases your chances of short sale success. It may be possible at that point to temporarily stop the auction, but it is certainly not guaranteed, and your options are severely limited.

If a short sale is the course of action you decide to pursue, the time necessary to get an acceptable offer and the time needed to close the sale is severely shortened. Any bump in the process, such as losing a buyer (which happens frequently on short sales) and you have virtually no time recover and put the deal back together again. Many of the failed short sales I’ve seen and heard about have similar facts – they simply run out of time.
If you want to increase your chances of a successful short sale, start early.

Tni LeBlanc is an independent Real Estate Broker, Attorney, Short Sale Agent and Certified Distressed Property Expert (CDPE) serving the Santa Maria, Orcutt and Five Cities area of the Central Coast of California.
She can be contacted at (805) 878-9879 for a short sale consultation.
*Nothing in this blog article is intended to solicit listings currently under contract with another broker.  Those considering a short sale are advised to consult with their own attorney for legal advice, and their tax professional for tax advice prior to entering into a short sale listing agreement. Not affiliated with the government. A lender may refuse to change a loan.
Copyright © 2011 Tni LeBlanc *How Time Can Run Out On Your Short Sale*
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