Common Misconceptions Among Realtors About Short Sales
What Many Agents Get Wrong — And Why It Matters to You
Short sales are one of the most misunderstood real estate transactions — even among licensed agents. If you’re a homeowner in Minnesota considering a short sale, it’s crucial to work with a Realtor who truly understands the process. Here are some of the most common misconceptions I’ve seen over the years and what you should know.
1. “Short sales aren’t worth the time.”
Many agents avoid short sales because they assume they’re too complicated or take too long. While the process can be more involved than a traditional sale, an experienced short sale agent can move things along efficiently — and often close within 60–90 days with the right preparation.
2. “The bank will never approve it.”
This simply isn’t true. Lenders approve short sales every day. The key is submitting a complete and compelling package — including financial documents, a hardship letter, a market-based listing price, and a qualified buyer’s offer.
3. “You have to be behind on payments.”
While many homeowners pursuing short sales are delinquent on payments, you do not have to be in default to qualify. If you can demonstrate hardship and negative equity, lenders will often consider a short sale to avoid future foreclosure risk.
4. “The seller makes money from a short sale.”
False. In a short sale, the proceeds go directly to the lender to pay off the mortgage — even if it’s less than the full balance. The seller typically receives no funds from the transaction unless incentives (like relocation assistance) are provided.
5. “Short sales ruin your credit just like foreclosure.”
Short sales do impact credit, but typically less than a foreclosure. Many sellers who complete a short sale are eligible to purchase again with an FHA loan in as little as 2–3 years (vs. 7 years for foreclosure).
6. “All real estate agents know how to handle short sales.”
Not even close. Most agents have limited or no experience with short sale negotiations. That’s why it’s essential to hire someone who specializes in this niche and understands how to package, position, and negotiate effectively with lenders.
Get the Right Representation
As a certified short sale specialist, I’ve successfully closed dozens of short sales across Minnesota — even the tough ones. I know what lenders are looking for, how to keep deals on track, and how to protect your best interests every step of the way.
📘 Download my free short sale guide
📞 Schedule a confidential short sale consultation
Joe Houghton
Broker Associate | RE/MAX Results
Certified Short Sale Expert – Minnesota Property Group
📞 (763) 300-2702
🌐 www.mnpropertygroup.com
