How likely is it that banks will approve a short sale if the homeowners have a 401 (k)?
Does anyone know what banks will NOT accept short sales regardless of the situation?
My view is that banks better approve short sales to bring the over-inflated prices back down or they can foreclose and take that route. If your client’s home is over-priced, then they have no reason to withdraw from their 401k to maintain an inflated property. That’s what I would prove to the bank via comps, listing history, etc.
Every case is different, just call the bank and speak to them directly. SPS servicing didn’t even ask me full short sale packages, just the contract and hud-1. Wilshire is now giving me 60-120 days to close with no hassle rather than the 20-30 days previously given by banks.
The 401k money is protected from the bank and will not be the reason a Short Sale is denied. Too many homeowners tap into their 401k’s only to lose the home anyway…