I am about to explain how the different types of loans impacts whether or not you will have a deficiency after you short sale your house. But, I first want to bust the common myth that you won’t know if you will have a deficiency until after you have started the short sale process.

Many agents will tell you that you won’t know for sure if you will have a deficiency until you have started the short sale process. Sure, they can give you the answer if you are in a non deficiency state like California.

But, what if you are in Florida, which is a deficiency state? They will usually tell you that you won’t know if you will have a deficiency until the short sale process has been started.

That is not necessarily true. First, here is the good news. In about 80-90 percent of all cases, you will not have a deficiency on a short sale even if you live in a deficiency state. But if your loan is the type that do not require deficiencies, then you don’t have to worry about a deficiency. The key is to find out the type of loan you have and the short sale guidelines for that type of loan.

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