Homesite Realty, Llc.

Homebuyer,

An FHA loan should be acceptable to the bank that is selling short but you will have to wait quite some time to find out, in most cases. The seller's bank takes terms, as well as price, into consideration when making a decision on whether to accept a shortsale.

Shortsales work like this: An offer is made to the homeowner and is accepted or denied by the homeowner, since the homeowner still owns the home. If accepted by homeowner, the buyer and seller then go into contract and the contract is sent to the bank for approval (or denial). It can take months for the bank to make a decision on whether they are going to take a reduced amount on the seller's loan.

Keep in mind, after months of waiting for an answer, if the bank accepts the amount agreed upon by the buyer and seller, they usually want to close immediately. The pitfalls of a shortsale are the time spent waiting for a decision and the fact that you need to go forward with your loan application process even before that decision is made. You will be laying out money for the application, appraisal, engineer, etc. and there is a chance that the bank might not accept the amount. There is also the chance that you will lay out money to extend your mortgage commitment if the date on that commitment expires before you have a decision from the bank.


There are no extra closing costs when buying a shortsale home, for the buyer. As a matter of fact, if you apply to the same bank, depending on the bank, you can save money on your closing costs.

If you have any further questions, please fell free to contact me: http://homesiterealty.net - Sun Nov 22 2009, 00:37