SHORT SALES 101

The Short Sale Process

Some of you may be wondering how you can go about selling your home the “short-sale” route, but aren’t sure how it works.

 

First and foremost, let’s define “short-sale” as it relates to real estate:

 

A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold

 

If you’re not sure whether you’ll be “short” we are able to complete a CMA (Comparative Market Analysis) & a Seller's Estimate for you to determine if you will be short when selling your home.

 

 

If you are indeed going to be “short” and want to move forward with a short-sale.

 

What are your first steps?

 

  • Contact us and will walk through the entire process - we are experienced in negotiating short sales with lenders and know the entire process from beginning to end. 
  • Sign a Third Party Authorization form that will be provided by us so we are able to discuss your loan with your bank.
  • We will initiate a short sale with your lender (for your first lien) via Equator (for most lenders).

Once the short sale has been initiated you will be contacted by your lender directly and will be asked to provide the following information directly to them  It's a great idea to get these items available and make copies for the bank (do not send originals):





  • All lien holders names and contact information
  • All loan numbers
  • Last 2 years tax returns
  • Last 2 years W-2s if applicable
  • A Profit/ Loss Worksheet if self employed
  • Last 2 Month’s Bank Statements from all accounts
  • Proof of Disability or Unemployment or Job Transfer (if applicable)
  • Hardship Letter - this explains why you want to short sale and why the bank should allow you to short sale

 

What happens next?



  • After your lender receives your paperwork they will initiate a BPO (Broker's Price Opinion) on your home to determine its value.  It is similar to a CMA but more detailed.
  • Your lender will contact you with an agreement between you and your lender to sell your home and what price they would like to price it for.
  • At this time we will sit down with you and write up a Listing Agreement for that amount. 
  • There will be additional paperwork to read and sign from the lender and once they have everything we will be contacted by them to list and market your home on the MLS.
  • We will take all the necessary steps to market and advertise your home to get a qualified buyer.
  • Once an offer has been received it will be submitted to the bank for approval.
  • Once approved then escrow will open and we will begin the steps on closing your home successfully.
  • If no offers are received within a specific time frame your lender will most likely reduce the price to generate more interest and hopefully an offer.
  • We will keep your lender updated on the steps we are taking to market & sell your home and are required to complete tasks like monthly reports, marketing descriptions, & updated BPO's, that will be completed in a timely manner.

 

Each lender is different and have their own set of forms, guidelines, etc. however, we are experienced with all lenders so we can anticipate and be prepared for the next step so there are no delays. 

 

 

For more information about short sales please see the links to the left or feel free to contact us anytime with any questions you may have.  We know this is not the path you chose and deciding to short sale is not an easy decision ~ we are here to help and guide you every step of the way.  





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