What Qualifies as a Short Sale Hardship?

Sellers aren’t entitled to a short sale just because they’ve lost equity in their home. Lenders look for other hardships when approving short sale transactions. 

The following hardships often qualify: 

• Job loss
• Illness
• Divorce
• Death of spouse
• Natural disasters
• Bankruptcy

However, besides a hardship, lenders also consider whether the home’s value has dropped, the mortgage is near or in default (you don’t have to default to qualify but you must prove that if something isn’t done soon, you will default, Udy notes), and the seller has no other assets.
What doesn't qualify as a hardship?  

• Bad purchase decision or over-bought on the home
• Unhappy with location
• Purchased another home
• Pregnancy
• Walk away
• Home value declined

If you have any questions regarding your particular circumstances, please contact one of our Short Sales and Foreclosures (SFR) certified agents. Prudential Laney Real Estate 910-256-0056.

Source: “Short Sale Hardships -- Qualifying for a Short Sale,” Tempe Real Estate Agent (Jan. 4, 2011)