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You Aren’t Eligible for a Short Sale If You Don’t Own A Home

You Aren’t Eligible for a Short Sale If You Don’t Own A Home

Not long ago, I found myself making a much dreaded phone call to a potential short sale seller:  “I’m sorry but you don’t own your home anymore, so you are not eligible for a short sale.”  He had no idea -- he thought they granted him another extension.  He met with me just three weeks prior and I asked whether he wanted to list his home as a short sale that day.  He declined, thinking that he still had time.  By the time he called me out to list the property it was already in the bank’s hands although neither he nor I knew.  The following Monday, I called a title company and found out that his home had been sold at foreclosure auction.  And then I had to make that call.

It happens more often that you think.  Potential short sale sellers should be aware that you have to be proactive to avoid foreclosure.  Often homeowners are lulled into a false sense of complacency when a bank continues to extend the date for their foreclosure.  So much so that when that date actually creeps up, they don’t believe that it will actually happen.  Often they hang on believing that they will be granted an acceptable loan modification, or another extension and when that does not happen -- if they have not been making payments -- they are facing a drastically shortened time clock if they then want a short sale instead of a foreclosure.

If you want a short sale instead of a foreclosure, you should contact a Central Coast short sale agent for a consultation after a Notice of Default is filed on your property.  If the bank files a Notice of Default -- they are reserving their right to foreclose on the property and you should take that seriously.   You must take action to avoid foreclosure.

If you are considering a short sale of your Santa Maria, Orcutt, Nipomo, or Arroyo Grande home, you should seek out an experienced short sale agent to guide you through this process.  If you would like a short sale consultation, please call my office to schedule a meeting or a telephone consultation at (805) 938-9950.

Tni LeBlanc is an independent Real Estate Broker, Attorney, Short Sale Agent and Certified Distressed Property Expert (CDPE) serving the Santa Maria, Orcutt and Five Cities area of the Central Coast of California.

*Nothing in this article is intended to solicit listings currently under contract with another broker.  This article offers no legal or tax advice.  Those considering a short sale are advised to consult with their own attorney for legal advice, and their tax professional for tax advice prior to entering into a short sale listing agreement.  Mint Properties is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.

Copyright© 2011 Tni LeBlanc *You Aren’t Eligible for a Short Sale If You Don’t Own A Home*

Tni LeBlanc, Broker
(805) 878-9879 mobile/text

CalBRE #01871795

Comment balloon 8 commentsTni LeBlanc, Realtor®, J.D. • May 05 2011 10:52AM


Oh that's so sad...I think that many people find themselves in this position and I feel so horrible for this gentleman and the others.

Posted by Karen Fiddler, Broker/Owner, Orange County & Lake Arrowhead, CA (949)510-2395 (Karen Parsons-Fiddler, Broker 949-510-2395) about 8 years ago

Although it's not easy to face these kinds of things, this is a great reminder that people cannot stick their heads in the sand and pretend this is not happening.  I cannot begin to imagine how it feels to lose one's home, but there is help available, if people will only take that first step.

Posted by Susan Haughton, Susan & Mindy Team...Honesty. Integrity. Results. (Long and Foster REALTORS (703) 470-4545) about 8 years ago

More than once I have had to knock on doors to inform the occupant that their home had been foreclosed on. These home owners thought they were in the process of getting a loan modification. Another occupant was a renter who had been paying rent the whole time the owner wasn't paying his mortgage. I dream of the day this mess is over.

Posted by Cynthia Larsen, Independent Broker In Sonoma County, CA about 8 years ago

Hi Tni - People are forever following the river of De Nile.

Posted by Conrad Allen, Webster, Ma, Realtor (Re/Max Professional Associates) about 8 years ago

That's a terrible call to have to make. 

Posted by Christine Smith, Exclusive Buyer Agent & Attorney, Canton, MA (Buyers Brokers Only LLC - www.BuyersBrokersOnly.com) about 8 years ago

Tni - I've had borrowers (who were former renters) who had the same happen to them that Cynthia described.  Can you imagine paying your rent every month, on time, and then having someone show up at your door one day telling you that you have three days to vacate.  Don't even get me started on the fact that there was an active lease in effect with a security deposit and getting thrown out with no regard to the lease contract or your deposit.

Posted by Donne Knudsen, CalState Realty Services (Los Angeles & Ventura Counties in CA) about 8 years ago

Tni~ Like Cynthia (#3), in post-foreclosure occupancy checks, I often meet "owners" who thought they were in some sort of workout.

I also hate having to call the real estate agent who has the house listed as a short sale. They almost never knew when the foreclosure sale was.

Posted by Liz Lockhart, GRI, Cape Girardeau Real Estate (Riverbend Realty, Cape Girardeau, MO) about 8 years ago

Karen - Yes, I felt bad for him too.  I had to give him some tips on finding a rental.

Susan - No I can't imagine either.  A short sale is a much better option. 

Cynthia - You and me both!

Conrad - So true, and right now the banks are making custom boats so you can float more comfortably.

Christine - Yes, it was.

David - Well they get lulled into thinking that they will get another extension then another one and then they are waiting on a last minute one and then one day they don't get that last minute extension.  Terrible process.

Donne - If I were in the market for a rental in my area the first thing I would do is check for a Notice of Default and look at the loan balances.  Renters do have rights but who wants to go through the hassle?  I know renters who are on their second "rental foreclosure."

Liz - Yes, it can be difficult to know.  In CA they won't re-post the new auction date so you have to keep calling and sometimes can't get accurate information.  I've known people who went out of town for the weekend to visit relatives and came back and their house had been foreclosed on -- they also thought that the bank had "worked out" their loan.  How devastating.

Posted by Tni LeBlanc, Realtor®, J.D., Tenacious Tni (805) 878-9879 (Mint Properties, Lic. #01871795) about 8 years ago