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Florida Short Sales Fail For Numerous Reasons

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There are many reasons that a short sale can fall through for reasons that are out of your control. A big reason is that the buyer does not come through.

Since a short sale can take months to close, buyers can lose interest in the property. Buyers in South Florida, like elsewhere, get buyer's remorse. The longer the process takes, the more this can come into play. Ensuring that your Agent or Negotiator can get your short sale completed in a expedited matter is important. Nothing is more frustrating then going through the whole process, planning movers, expecting HAFA money and then having the buyer back out.

Depending on how your contract is worded the buyer may have many outs that do not expire until after the short sale is approved. The longer the process takes the more of a chance that something could happen to the buyer that would keep them from getting approved for their loan. It is imperative that you or your agent verify that the buyer has been pre-approved by some type of automated underwriting process, and not just a loan officer who may have taken a quick look at their credit. If the buyer is paying cash, proof of funds should be requested at the time of the initial contract signing.

The lender will still be going along with their foreclosure, and it is handled by a completely different arm of the bank. The longer the approval process the more likely that the sale date of the foreclosure will be set. The homeowner's association may also be attempting to foreclose on the property. The association's foreclosure process is more streamlined then the banks and can go through much quicker. If the association forecloses first, you will no longer own the property, and the short sale process will be over.

If there is a tenant in the property, provisions must be made for them to move out in a timely manner. If the tenant has a lease that goes past when the short sale would like to close, they are entitled to remain as tenants in the property. Unless the buyer is an investor most people would not want a tenant in the property. The lease the tenant has even is valid against the lender if they foreclosure (assuming it meets certain requirements). Sometimes tenants are more apt to move if one of the parties offers them moving expenses. If the tenant fails to move out you can lose all the benefits that were negotiated as part of the short sale, including waiving any deficiency and thousands of dollars in moving incentive that the seller may be eligible.

For more stories and issues with Short Sales, check out www.MyShortSaleNightmare.com

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