IF MY HOUSE NEEDS LOTS OF REPAIRS, WILL THE BANK STILL CONSIDER A SHORT SALE?

Often “Yes”. In fact, many banks are more motivated to do a short sale on a property that needs repairs than one that doesn’t. The bank fully understands the risk of loss goes up if they pursue a foreclosure on a property that needs a lot of work. It is probably the easiest way to get a discount approved for a short sale when you can justify lots of repair work needed to bring the property back up to a marketable condition to be resold.

Besides, the banks are in the loan business NOT the repair or handyman one.

It really doesn’t matter the type of house or condition it’s in, all mortgages can be discounted. Some specific loan types like FHA and VA have set rules in place, but nearly all banks will accept short sales. The very best types of properties to perform short sales on are houses that need repair work because the bank will often allow a bigger discount for it. Property that is overleveraged (owing more on the house than market value) often make good candidates.

In-experienced, rookie or uneducated real estate investors who see a house that has more loans against it than market value may walk away from it. However experienced or seasoned real estate professional investors see quite the opposite. The experienced short sale investor understands properties with large second or junior liens against it can be gold waited to be found. Why? Because the junior lien holders will accept pennies on the dollar to fully settle their position. They know if the property goes to foreclosure, they will be wiped out at the foreclosure auction. These types of lenders with big second and third mortgage positions would much rather have something than nothing.