Why Short Sales Fail More Often Than Homeowners Expect
Short sales are often presented as a clean solution when selling a home with little or no equity. In reality, they are one of the most fragile real estate transactions a homeowner can enter—especially in New York.
In my 15+ years working with homeowners across Rochester, Buffalo, and Upstate New York, I’ve seen the same mistakes derail short sales again and again. Most of them are avoidable—but only if you know what to watch for early.
Here are the top 10 short sale mistakes that quietly push homeowners closer to foreclosure.
Mistake #1: Waiting Too Long to Start the Process
Many homeowners wait until:
- Payments feel unbearable
- Notices become intimidating
- Foreclosure feels “real”
By then, leverage is already shrinking.
Short sales work best when started before urgency turns into pressure. Waiting too long often limits buyer interest and lender flexibility.
Mistake #2: Assuming Any Buyer Is Good Enough
Not all buyers can close a short sale.
Many offers come from:
- Wholesalers without funds
- Out-of-state investors unfamiliar with NY law
- Buyers hoping to renegotiate later
Lenders evaluate buyer credibility. Weak buyers lead to stalled files and denied approvals.
Mistake #3: Chasing the Highest Offer Instead of the Strongest One
Short sales are not retail sales.
Banks care about:
- Probability of closing
- Buyer funding
- Timelines and risk
The highest offer often collapses first—forcing homeowners to start over with less time and fewer options.
Mistake #4: Believing the Bank Will “Eventually Say Yes”
Banks are not obligated to approve a short sale.
Even strong files can be:
- Countered repeatedly
- Delayed internally
- Denied outright
Assuming approval is inevitable leads to complacency—and missed backup planning.
Mistake #5: Not Understanding New York’s Attorney-Driven Process
New York is not a fast-moving state.
Short sales require coordination between:
- Seller’s attorney
- Buyer’s attorney
- Title companies
- Lender loss mitigation departments
Inexperienced parties create delays that banks interpret as risk—often killing the deal.
Mistake #6: Missing or Delaying Documentation
Short sales live and die on paperwork.
Common issues include:
- Incomplete hardship letters
- Outdated financials
Banks rarely chase missing documents. They simply stall—or close the file.
Mistake #7: Letting Foreclosure Timelines Run Quietly in the Background
One of the most dangerous assumptions homeowners make is believing:
“The short sale pauses everything.”
In many cases:
- Foreclosure timelines continue
- Legal actions advance quietly
- Options disappear without warning
Short sales do not automatically stop foreclosure.
Mistake #8: Relying Solely on the Bank’s Advice
Banks aim to reduce immediate default—not necessarily protect long-term homeowner outcomes.
Options like:
- Payment plans
- Trial loan modifications
Are often suggested without discussing what happens if they fail. Homeowners who rely solely on lender guidance often lose strategic ground.
Mistake #9: Not Having a Backup Plan
Short sales are unpredictable.
Homeowners should always ask:
- What if this is denied?
- How much time remains?
- What is Plan B?
Without a backup strategy, a failed short sale can turn into a rushed foreclosure scenario.
Mistake #10: Waiting for the “Perfect” Outcome
The perfect solution rarely exists in distressed situations.
Waiting for:
- Better terms
- Higher offers
- Market shifts
Often results in fewer choices and more pressure.
Progress beats perfection during a short sale.
Why These Mistakes Matter More in Rochester, Buffalo, and Upstate NY
In Upstate New York, short sales:
- Take longer
- Involve courts and attorneys
- Require precise coordination
Mistakes compound faster here—and recovery options shrink sooner than homeowners expect.
How We Help Homeowners Avoid These Pitfalls
At Brett Buys Roc Houses LLC, we regularly work with homeowners who reach out after:
- A short sale collapses
- A buyer disappears
- Time runs short
Our role is to help homeowners:
- Identify real risks early
- Understand buyer credibility
- Preserve options before urgency sets in
Sometimes that leads to selling.
Sometimes it doesn’t.
But avoiding mistakes always improves outcomes.
Frequently Asked Questions
Do most short sales fail?
Many do—often due to buyer issues or timing mistakes.
Can I switch buyers during a short sale?
Yes—but delays can hurt approval chances.
Does a short sale stop foreclosure in NY?
Not automatically.
Is it better to sell earlier instead of trying a short sale?
Sometimes—depending on equity, timing, and goals.
Final Thought: Short Sales Reward Preparation, Not Hope
Short sales don’t fail because homeowners are careless.
They fail because small mistakes compound quietly.
Knowing what to avoid gives you control—before the clock decides for you.
If you’re navigating a short sale in Rochester, Buffalo, or anywhere in Upstate NY, clarity early can protect options later.
Visit brettbuysrochouses.com
No pressure. Just honest guidance—before mistakes become irreversible.