This is part 4 in our week long series on short sales.

Yesterday: Don’t Walk Away | Today: Short Sale Candidates | Tomorrow: Short Sale Drawbacks

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Short sales are more popular than ever. One recent informal survey suggested that 18% of all listings are short sales. It’s a staggering number. So who are all these people with these listings and how did they qualify? Below are common characteristics of short sales candidates

• Home value has dropped. This is a classics short sale trait. The market has dropped off considerable and left thousands of homeowners with a mortgage debt that exceeds their home’s appraised value. It makes refinancing impossible and often times, a short sale is the best option if you just can’t keep the home.
• The mortgage has defaulted or will in the near future. While it’s more common to see a short sale approved when in default status, it’s becoming more common to see lenders approve a short sale earlier in the process to mitigation their future losses.
• The seller has a hardship. You’re much more likely to get approved for a short sale if you have a documented hardship of why you simply can’t afford to stay in the home and make payments. The hardship letter is an important document that should be carefully crafted. AMG can advise you of how to do this.
• Simply can’t afford the home. If it’s just not possible to afford the home even with a loan modification, a short sale is the right option. It’s unfortunate if this is the case as no one wants to lose their home, but at least with a short sale, you can limit your credit score damage and responsibly reach an agreement that gets you free and clear of the situation.

If any of the above characteristics fit your situation, you should at least have a conversation with a professional about your options. Time can become a real critical factor and you need to stay ahead of the problem in order to reach the best possible resolution.