A short sale in Florida begins when a lender is offered a purchase and sales contract for the real property in Florida that is subject to their mortgage for an amount that is less than the current balance due under that mortgage. For example: A Florida homeowner has an existing first mortgage of $300,000. A real estate contract, signed by the homeowner/seller and buyer, is submitted to the lender with an offer for $200,000, which is less than the balance due. The lender accepts the offer for $200,000, which is short $100,000 from the current balance. In order to complete the sale of the property to the buyer the lender releases their lien or mortgage against the property. This now becomes a short sale.
Short sales should not be taken for granted as lenders do not have to accept a short sale offer. Lenders can place terms and conditions on the lender’s approval that can kill the sale. Always remember that a release of the lender’s lien does not necessarily mean a discharge of your liability under the promissory note.
The above is a summary of a short sale. There are many other issues to be discussed depending on the status of the property. For example, whether the property is the primary residence or an investment property can have substantial consequences to the borrower/seller in the short sale process. Once that issue is determined then the lender will assign the short sale to a specific lender program. Neither the homeowner/seller nor Family Counseling Law Firm (FCLF) has any control over which program the lender selects. Lenders generally require their Borrower to submit the following documentation during the short sale process:
- Signed purchase agreement,
- MLS listing and history,
- proof of deposit,
- mortgage commitment from purchaser or proof of cash, and finally
- Lenders require the Borrower to provide certain financial information.
See disclaimer page for additional information regarding short sales and the short sale process.
We encourage every property owner to consult with an attorney before engaging in a short sale.
For more information on short sales in Florida from a real estate perspective go to: www.thefchomes.com.
Call us for a free consultation at our toll free number 1-866-285-1114 or complete the contact us form on this site. We are multi-lingual with the ability to communicate in English, Spanish, and Portuguese.
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