Charlottesville Short Sales | What’s an Acceptable Hardship?

Charlottesville Short Sale HardshipsDo you owe more on your Charlottesville home than what it’s worth in today’s real estate market? Unlike a traditional seller, a Charlottesville short sale seller must obtain approval from their lender(s) to accept a short sale. In most cases, a lender is going to require a demonstrable financial hardship to approve a short sale.

What is a short sale hardship?

A hardship is a material change in the financial situation of a homeowner that is or will affect their ability to pay their mortgage. A lender is going to require you to prove this hardship by submitting a signed hardship letter along with supporting financial documentation. Just wanting to walk away because you’re upside down in your home is not a hardship and more than likely will not qualify you to complete a short sale.

What are acceptable short sale hardships?

There are many valid reasons why a homeowner may find themselves in imminent danger of being in default. Here’s a non-exclusive list of situations a lender may take into account when reviewing a short sale package:

  • Unemployment
  • Loss or Reduction of Income
  • Business Failure
  • Bankruptcy
  • Medical Illness or Disability
  • Medical Bills
  • Too Much Debt
  • Mortgage Payment Increase Due to a Rate Adjustment
  • Divorce or Separation
  • Incarceration
  • Death
  • Job Relocation
  • Military Duty

Can a seller qualify for a short sale without a hardship?

Yes, it is called a strategic short sale. A strategic short sale is when you can afford to make your mortgage payments but since you owe more than your home is worth you strategically decide to sell your home and pursue a short sale.  There are no guarantees a lender will approve a short sale without a hardship. It’s also likely that the lender may require a strategic short seller to participate in the transaction by making a cash contribution and/or signing a promissory note. Remember, every bank is different so guidelines vary from bank to bank.

A short sale is not like a traditional real estate transaction. Not all real estate agents have the specialized knowledge and experience to quickly and efficiently process a short sale transaction. Hiring an experienced Charlottesville short sale agent could mean the difference between facing foreclosure or not.

Are you thinking about selling your Charlottesville home as a short sale? Each situation is unique, contact us for a FREE, no obligation, confidential consultation to evaluate your options. Don’t wait, get the help you need before it’s too late!

The content provided is for educational and informational purposes only. We can not give legal or tax advice. It is highly recommended that you consult with an attorney and tax accountant regarding the specifics of your situation to determine the best solution for you.

Photo Credit: Lumaxart on Flickr (CC BY-SA 2.0).

Published by Allegra Williams

Allegra Williams is a full-time residential Charlottesville VA REALTOR®. As a Certified Distressed Property Expert, Allegra helps homeowners facing financial distress sell their homes through the successful negotiation of a short sale. Allegra serves Charlottesville and the surrounding counties of Albemarle, Greene, Fluvanna and Louisa.

Join the Conversation


  1. Thank you for sharing this Allegre. Keeping the home owners informed about their options and how they can make things better just shows how expert you are and how dedicated you are as a charlottesville short sale agents. This is a very informative post.

  2. I agree.. Information like this will help many home buyers become more informed about short sales and what are the procedure they have to go through. And at the same time, they should consult expert Charlottesville short sale agents like Allegre for a faster and smoother process. Great post!

  3. Great information for those considering a short sale in Charlottesville. It is essential that people contact an experienced Charlottesville short sale agent like yourself, Allegra. Short sales are extremely complex and require a special skill set.

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