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[cpotter]

Is there a rule of thumb on how much of a discount off fair market value the bank will go. For instance I have a home fair market around $305,000....offer is at $280,000....original loan $500,000. Bank will be taking over a $200,000 loss already. Will they discount any further down to $280,000?

[MortgageBanker]

Typically a bank will look at a short sale on a case-by-case basis with certain approval criterias in mind. Although it sounds like a tough sell to get your lender to agree to take a $220K loss on their books. They might explore the idea of modifying your loan terms before the possibility of a short sale. How did you come up with the market value? Most lenders will use a sales approach to determine this. You can call me if you have more questions. I am a Loan Officer in San Diego, DJ at 858-875-1199 ext 234