question about short sale viability

[Tim Wilkinson]

Hello Community,

I know of a couple properties that have mortgagors in default for a long time. Sometimes they are staying years without paying a payment. In Maine recently, I know a man who lived almost five years in his home without making a payment. 

My question is this:

Can a short sale offer be made directly to the bank without including the delinquent owner? Or do all short sales have to have the delinquent mortgagor included for ethical reasons? I only hear about short sales being initiated by the bank and an agent that specializes in them. 

Is it possible to avoid this whole process with an offer to the mortgagee?

[Hattie Dizmond]

@Tim Wilkinson

A short sale is initiated by the home owner.  In some cases a bank or lien holder may suggest that as an avenue of relief, but the home owner has to pursue that option.  The only thing a lien holder will truly initiate is foreclosure.

So, the short answer to your question is...absolutely contact the owner occupant of the property.  Being years delinquent on your mortgage should be the definition of motivation.  (Of course, that's coming from someone in Texas, where that kind of thing is unlikely to happen, because it's pretty easy to complete the foreclosure process here.)  

On a short sale, the lien holder comes into play, because they have to approve the price, since it will be less than what is owed...thus the concept of "shorting" the lender.