What is a "good" short sale.

Someone said, “Not every home that has no equity and is in foreclosure is a good candidate for a short sale.” My question is, “Why not?” What other componets need to be there to make it a worth while short sale?

One where there’s a BIG FAT 2nd mortgage. :slight_smile:

The big fat second is great. When I go to foreclosure auctions 9 out of 10 times that second mortgage is completely wiped out. Now this does not mean the 2nd will discount, though I do not know why, but you have a much better chance to create a large amount of equity with a second mortgage in place.

Timing is critical in getting the 2nd to short. They get wiped out at the trustee sale (auction)…so a few days before that you give them the take it or leave it lowball and if you’re lucky they’ll say OK and you can hold off the 1st and get the thing sold last minute. You really have to be on top of the timelines, which is why most people screw up short sales.