The test that decides short sale or cash sale
People are told conflicting things about short sales by several parties who each have something to sell. Here is the version with nothing attached.
Equity means a cash sale. Being underwater means a short sale. That is the whole test, and it does not turn on your preference or on how good a negotiator you are. A cash sale runs on your timetable, because the money is already there. A short sale runs on the servicer's, because the servicer has to approve taking a loss before anything can close.
What your lender wants before approving a short sale
Expect adjournments, requests for documents you already sent, and a valuation ordered by the servicer that you will never see. That is the ordinary texture of a short sale rather than a sign yours is going badly.
A short sale also usually runs alongside a foreclosure that does not pause politely while the file is reviewed, which is why starting a short sale early matters so much. Begun late, the short sale and the sale date end up racing each other.
Why local knowledge changes the number
A house on Johns Neck Road. A house on Seymour Drive. Both in Shirley, bought and paid for by us.
Shirley is roughly 26,360 people in Suffolk County, ZIP 11967, and the housing stock is mostly ranch, cape cod, hi-ranch. Around William Floyd Parkway and the Smith Point Bridge, most of it is old enough that the mechanicals are on their second or third life. The Mastic-Shirley stop pulls buyers who commute, which supports the good houses and does very little for the ones that need a roof. We have been buying across Suffolk County for 15+ years. We know what the William Floyd Union Free School District does to a resale price, which blocks still have oil tanks in the ground, and what a house like yours is actually worth here.
Helping Shirley owners through a short sale
We do not turn underwater sellers away. We have worked a great many short sales across Nassau and Suffolk, and we will work yours with you if that is what the numbers call for.
That means we make the offer, we help assemble the short sale package, we deal with the servicer's negotiator, and we stay in it through the adjournments. A short sale is slower and less certain than a cash sale and we will say so at the start. But an underwater owner with an experienced short sale buyer alongside them is in a far better position than one calling around for somebody willing to try.
How long a short sale takes against a cash sale
A cash sale on a Shirley house moves at whatever speed you want, because the funds are not conditional on anything. A short sale moves at the servicer's speed, and the servicer is being asked to approve a loss.
So the practical advice is the same on either route: start earlier than feels necessary. A short sale begun months before a sale date has room to breathe. The same short sale begun three weeks out is a race, and it is one you do not control.
How selling a house in a short sale in Shirley works
- 1
You tell us about the house
An address in 11967 and a rough idea of condition. Two minutes on the phone or the form. We do not need photographs, a clean house, or anything fixed first.
- 2
One short visit
One of us comes by once, usually for less than half an hour. On a ranch or cape cod like most of Shirley, what we look at closely is the roof, the boiler and the wiring, not the finishes.
- 3
We put a figure in writing
You have a written number within 24 hours, a single figure rather than a "somewhere around". Feel free to check it with a Suffolk County agent. When a house is ready to list as it is, listing can beat us, and we would rather you knew.
- 4
The date is up to you
Close quickly, or set a date months ahead to fit probate, a tenant or your own move. Either way there is no 88 to 103 days of a Shirley listing looking for a buyer and waiting on a mortgage approval.
Deficiency, credit and taxes: ask before you choose
Owners often ask which is worse for their credit, a short sale or a foreclosure. The honest answer is that it depends on how it is reported and on your wider picture, and a credit counselor can give you a better read on that than a buyer can.
What we can tell you is the transactional difference. A cash sale with equity behind it pays the mortgage off and you keep the balance. A short sale pays the servicer less than it is owed, on terms set out in an approval letter that an attorney should review before you sign it.
What you do not pay when you sell a house in a short sale
Every line below is a cost of listing a house in a short sale the retail way that simply does not arise here.
- Agent commission
- $27,500 at 5% of the Shirley median none
- Seller closing costs
- About $11,000 on a $549,990 sale. We can cover these. none
- Repairs to make it listable
- Whatever the house needs, paid up front none
- Cleanout and removal
- Charged by the truckload, and done before the first showing none
- Carrying costs while it waits
- Taxes, insurance and utilities for the 88 to 103 days of finding a buyer and waiting on their mortgage none
Start with the written payoff figure
Ask your servicer for a written payoff statement. Not the balance on the last statement, and not what you originally borrowed. The payoff includes arrears, fees and interest through the closing date, and it is the number that decides whether you are looking at a cash sale or a short sale.
It takes one phone call and you are entitled to it. Bring that figure to us and we will give you a written offer on a Shirley house alongside a straight read on which route it puts you on.
Common questions
Do you handle short sales in Shirley?
We do. A short sale is a different animal from an ordinary purchase, and we have taken plenty of them through to closing in Suffolk County. Tell us the payoff figure and where the file stands and we will tell you what we think.
How do I find out what I owe on the mortgage?
Ask the servicer for a written payoff statement. It is your right to have one and it takes a phone call. That figure, set against what the house is worth, is what decides between a short sale and a cash sale.
Can I do a short sale on a Shirley house if foreclosure has already been filed?
A short sale and a foreclosure frequently run at the same time, and the short sale has to outpace the calendar. It can be done and we have been through it. Tell us where the Shirley case stands, and speak to an attorney the same week.
Which is better for me, a short sale or a cash sale?
It is not really a preference. If a Shirley house is worth more than the payoff, take the cash sale, because it is faster and simpler. If it is not, the short sale is the route, and we can work it with you.
Will I walk away with money from a short sale?
A short sale is about clearing the debt rather than producing proceeds. If there is equity, you are not in a short sale at all, which is the first thing worth checking. Get the written payoff before you assume it either way.