Short Sale properties in bankruptcy

[Mike Neubauer]

I have recently been getting a lot of calls from people that have an upcoming foreclosure date, and are in the middle of filing bankruptcy. They say they would do a short sale if it would benefit them. The points I make of waving a deficiency judgement and less severe hit on credit report are mute to them because I believe the deficiency will be waved as part of the bankruptcy and their credit is shot with bankruptcy anyways.

Any pointers on some benefits to explain to them to make them want to do a short sale?

Also, is there a chance the deficiency judgement will not be waved just because the property is part of the bankruptcy?

[Wayne Brooks]

Mike,
One small disagreement with previous post. The Trustee would only be concerned about the price if there was some equity. If the mortgage is $300k, he doesn't care if it sells for $150k or $200k, it's upside down and no proceeds are coming the BK courts no matter what. That being said, the shorted lender will want something 85-90% of FMV, in it's Current condition. Pictures and multiple contractor estimates can help.