luxury home short

[Maryann L.]

Most of the houses we've done so far are under $400,000. I have a homeowner that just called that bought a home for 1.2 mil and owes $800,000 and some change.

Because she paid over 1.2, can we short this? I thought the new rules stated nothing over $800,000...or is it nothing over $800,000 where the deficiency is waived...anyone here do luxury homes?

[James Ward]

Getting Lenders to peform a Short Sale on a larger priced property is not necessarily the problem. The biggest items to consider are:

1) The spread might not be what you expect. Remember: The Lender will only allow a discount to a level that makes sense to them.
2) Getting an end Buyer. Finding an end Buyer for upper end properties is not as easy as finding Buyers for the "typical" property.
3) Deficiencies. The Lenders have less reasons to totally let the property owner walk away free and clear when large loan amounts are owed.

I hope this has helped.