Can my short sale be approved if I have cash and/or assets?
Contrary to popular belief, short sales are not just approved for the destitute, and you do not have to be in foreclosure to get started.
It is possible, although much more challenging, to be approved for a short sale for your home even if you are current on the payments, and/or have a large bank account, stocks or other equity rich properties.
The key is planning in advance, and setting proper expectations for what you are up against.
The best time to financially plan for your short sale is BEFORE you ever list your home!
Nearly 100% of short sales have no out of pocket costs for the seller, specifically when they are behind on the mortgage, and lack any significant assets.
However, not all short sales are completely "free". While closing costs are generally covered by the lender, sometimes and lately more often, the lender will in fact ask certain sellers to contribute to the short sale in the form of cash or a promissory note in order to approve their short sale.
Seller situations that will trigger a lender to reject a short sale or ask for cash and/or promissory notes:
If you fit the above criteria the lender may deny your short sale request, or will likely be asking you for something.
What kind of contribution will the lender be looking for?
While all lenders/investors have slightly different guidelines, they will be similar to these requests from Fannie Mae:
- 20% of the borrower’s non-retirement cash reserves, or
- Four times the contractual monthly mortgage loan payment including PITI. If the servicer does not escrow for T&I, it must estimate the borrower’s monthly tax and insurance premium amounts.
You may in fact agree to just pay the cash or sign up for the note to move things along, but there are a few ways that are often successful in minimizing or eliminating the request altogether:
Once in a blue moon, a lender will not budge at all on a contribution. In these cases it is best to consider your settlement options. All in all, requests for contributions are generally pennies on the dollar versus the amount of the whole debt and are sometimes your best option going forward, especially in a deficiency state like Florida.
Need more help to see if you can be approved for a short sale?
We've been specializing in getting short sales approved since 2008 and we've seen it all! Contact us today for free, confidential advice!
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B.P.
Last Updated on August 4, 2025 by Minna Reid