Voluntary Relocation, and Short Sale

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Permalink Reply by Bryant Tutas on January 26, 2010 at 9:20am

Hi Ben, Job relocation may be considered a hardship. The hardship is that you need to sell but you can't because values have dropped so far. But of course there is no guarantee that Chase and BofA will see it this way.

The lender(s) may ask you to contribute to the "short" with a cash contribution and/or a new promissory note. This really depends on your financial position and whether or not you have the means to pay. If you are changing jobs for a increase in pay then the lenders may very well want a piece of it. Be sure to seek competent legal and tax advice.

Unfortunately there are no definitive answers on how this will all platy out for you. Your credit score will certainly decrease but you may still be in a position to purchase another home at some point. That point could be immediately or several years.

Going through a short sale has negative consequences. The question yo have to ask yourself is "Are the short term consequences worth the long term benefits?" Only you know the answer to this question.

I hope this helps.

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Permalink Reply by Eric M. Boyd on January 26, 2010 at 1:05pm

Hi Ben,

Last year, I sold a townhouse through short sale with a seller who relocated by choice. They were never late on payments or anything. Their mortgage was with Citibank. They still had to provide all their financial paperwork for the process, but the lender did approve the request. I think the Net to the lender was around $20k below their mortgage balance. The lender didn't ask the seller to pay the difference, either. A few months after the sale, the seller contacted me to let me know they were able to be approved for a new mortgage at their new location, as the short sale didn't hurt their score that much. I forget the actual impact on their score, though, but it wasn't significant.

Anyway, that's but ONE seller's experience to share with you. As Bryant said, certainly seek competent legal and tax advice. Good luck!

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