Cartus Consulting guides organizations of all sizes to the best solutions in global mobility and mobile workforce development. In this, the second post in a four-part series, Cartus Consulting Services looks at the top issues in U.S. Home Sale.
Would a short sale help a transferring employee who owes more than his or her house is worth get out from under a departure home?
A short sale is one of the tools that may be available to help your employee. There are a number of factors to consider when determining your organization’s policy on short sales:
1) Talent management–how badly do you need this employee in the new job/location?
2) Cost–do you provide a company-supported program, such as through Cartus, or a guaranteed buyout home sale?
3) Implications of no support–will a short sale leave the employee mired in paperwork and ultimately result in a failed relocation?
It’s important to establish a policy on short sales for consistency and fairness, and to consider doing some due diligence upfront, such as through a formal or informal candidate assessment program so the employee has the opportunity to bring forth issues that may complicate the relocation.
Other considerations in a short sale situation are loss on sale and the home sale incentive, if applicable. Generally, an employee should not be penalized for something that is likely beyond his or her control, so the short sale should not result in benefit reduction. However, lenders will treat the loss on sale payment and the home sale incentive as an employee asset.
For more information, read the full Cartus Consulting Services | Top Issues in U.S. Home Sale document, and if you are interested in the short sale process, please see a MOBILITY magazine article “Short Sales and Clawbacks and Lies Oh My!” written by Bruce Perlman, senior vice president and general counsel of Cartus.
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