Sellers need to learn their options from a reliable source before agreeing to do a short sale. Don’t just take someone’s inexperienced word, as every short sale situation is different and every bank plays by their own rules (many times just created at the moment) and the seller could find themselves in situation that they are stuck with.
Many sellers mistakenly believe that they can “pick and choose” what they want to do after signing a short sale purchase contract with a buyer…not so.
MYTH: Sellers think that once the bank responds with a price and the terms under which they are willing to short sale the property, that they can then decide if they want the deal.
FACT: When the seller signs a “short sale” contract, without any specific provisions for the seller, it is subject to the banks approval of the price and the terms in the contract….a BUYERS OPTION TO “TAKE IT OR LEAVE IT”, NOT THE SELLERS!
EXPLANATION: If the seller signs a short sale contract agreeing to sell to a buyer for a certain price/terms and the bank approves the contract, that is the”3rd party bank approval” needed to satisfy the contract contingency… the seller is then obligated to move forward with the closing at the banks terms. If the seller does not like the banks “re-payment plan”, the taxes they have to pay, or the ding on their credit report. UNLESS THAT WAS A CONTINGENCY IN THE CONTRACT FOR THE SELLER, THEY NO LONGER HAVE THAT CHOICE.
This is why Sellers need to TALK TO AN ATTORNEY FIRST so that they understand the whole picture and if there is a line they do not wish to cross they need to write that into the contract… or they may just end up carrying the debt with them.
Copyright © Buyers Broker of Florida 2010 “Short Sales and Sellers Mistake”