What Really Happens After a Short Sale Is Approved?
You got the short sale approval—congrats! But don’t start popping champagne just yet. That approval from the first mortgage lender is a big step forward, but it’s far from the finish line. In fact, for most agents and investors, this is where things can get unexpectedly messy if you’re not prepared.
Step 1: Subordinate Liens Need Love, Too
Once the first mortgage lender issues their approval letter, your next task is to finalize any subordinate lien approvals. That includes:
- Second Mortgages: Submit the offer, preliminary CD, and first lien’s approval. Expect about 30 days for a response.
- IRS & State Tax Liens: Often released via an Offer in Compromise once you prove there’s no equity. The debt remains, but the lien gets lifted from the property.
- Non-Government Liens: HOA, contractor, or solar panel liens require direct negotiation. Everything is negotiable—it just depends on the lienholder.
Everything Is Negotiable—But Timing Is Key
Many deals die because subordinate liens aren’t addressed early. At Crisp, we run title upfront so we can tackle liens from day one—no surprises later.
Step 2: Closing Doesn’t Just Happen
Once all liens are settled, the buyer proceeds with inspections, loan documentation, and certifications. The closing officer must then send a final settlement statement to the lender for signoff—at least 48 to 72 hours before closing.
Missing fees or last-minute changes not on the original CD can kill the deal. That’s why early prep is everything.
How Crisp Prevents Closing Chaos
- Initial title search reveals all liens
- All costs included in the first submitted CD
- Every approval is double-checked for hidden conditions
With Crisp, the approval doesn’t mean we’re done—it means we’re just getting started.
Final Word
An approval letter might feel like the finish line, but it’s really the baton pass. The next leg is full of twists, turns, and trip wires—but with the right prep, it’s a smooth sprint to closing.
Need help making sure your next short sale doesn’t fall apart after approval? Let’s talk.