In fact, I can't see much benefit to a seller in a short sale. It doesn't help their credit, and usually doesn't allow them to escape liability if there is a second trust.
I think these folks that told me about it had the defiency judgment on their original mortgage, but it was with a smaller bank.
In Florida prices have dropped about 50 percent from the peak in 2006. These folks did it right, put large down, affordable payments...until unemployment took it’s toll.
Sad part is the bank absolutely would not work with them on lowering interest rate (they weren’t asking for principle reduction.) And in Florida where our insurance seems to go up every year, and assessments downward haven’t kept up with the market so taxes are still pretty high, it’s pretty hard for folks that lose their income. So they sold on a short sale, the bank okayed a low ball offer, and then hit them with the deficiency judgment.
I sort of agree with this type of judgment but wonder why the bank isn’t willing to deal with the present homeowner who’s current on their mortgage but struggling.
That used to be the case. Not Today. Most banks bid much lower than the balance and many do not bid at all.