Short Sale Negotiation in Florida A short sale is the sale of a home for less than the total amount you still owe on the mortgage. The lender agrees in advance to accept the sale proceeds as full or partial satisfaction of the debt. For homeowners who owe more than their home is currently worth, […]
Short Sale Negotiation in Florida
A short sale is the sale of a home for less than the total amount you still owe on the mortgage. The lender agrees in advance to accept the sale proceeds as full or partial satisfaction of the debt. For homeowners who owe more than their home is currently worth, or who can no longer afford the property and want to avoid foreclosure, a short sale is often the least damaging way to exit an unaffordable mortgage.
Short sales can genuinely benefit everyone involved. Homeowners avoid a completed foreclosure on their record and typically preserve more of their credit standing. They can walk away with the matter resolved rather than facing years of uncertainty. Lenders often prefer a short sale to a foreclosure because foreclosing, holding, and reselling a property is expensive and slow. A short sale usually results in a smaller loss than a completed foreclosure and resale.
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Despite the benefits, short sales are not simple transactions. They require the lender’s approval of both the buyer’s offer and the final settlement terms. They also require coordination between multiple parties: the homeowner, the buyer, the buyer’s lender, the listing agent, and the seller’s lender or lenders if there is more than one mortgage. And they require negotiation over whether the lender will pursue a deficiency after closing — the difference between what you owed and what the sale actually recovered.
That deficiency question is often the single most important part of a short sale negotiation. Florida law does not automatically eliminate a lender’s right to pursue a deficiency judgment just because a short sale closes. You have to negotiate that release and, ideally, document it in writing as part of the settlement. An attorney negotiating your short sale will push for a full release of the deficiency, not just lender approval of the sale price, so you actually walk away from the property free and clear.
How Prell-Spearing Law Firm Handles Short Sale Negotiations
We work directly with your lender’s loss mitigation and short sale departments, and prepare and submit the hardship documentation the lender requires. We negotiate the settlement terms, including deficiency waiver language, and coordinate with your real estate agent and the buyer’s side so the transaction actually closes instead of stalling in review.
Frequently Asked Questions
Will I owe taxes on a short sale? The IRS can sometimes treat forgiven mortgage debt as taxable income, though exceptions may apply depending on your circumstances and current tax law. This is a question for your accountant or tax attorney, not something to leave to chance. We’re happy to coordinate with your tax professional as part of the negotiation.
Can the lender still come after me for the difference after a short sale? Only if the settlement didn’t waive the deficiency. This is exactly why the release language in a short sale agreement matters as much as the sale price itself, and why we negotiate for a full waiver whenever possible.
How long does a short sale take? Short sales typically take longer than a traditional home sale because of the lender approval process, often several months from an accepted offer to closing, though timelines vary by lender and how complete the initial submission is.
Serving Clients Throughout Florida
Prell-Spearing Law Firm serves clients from our Cape Coral and Naples offices, with regular service to Punta Gorda, Fort Myers, and Venice, and we represent clients statewide.
