|
(Part
I covered qualifying your listing for a short
sale)
The banks
inventory of foreclosed properties are still
accumulating and costing the banks lots of
money. With a projection of a huge number
of foreclosures yet to come, lenders are acting
more quickly and favorable to short sales.
And a number of
home owners are giving short sale a try.
Home owners are seeing short sale as a way to
preserve their ability to purchase a home in the
future.
To get the
lender to agree to a short sale, you must have
done your homework and have your paperwork and
answers ready. More importantly, you should
approach the lender with good reasons and solid
facts as to why the lender should accept the
short sale.
Part II -
The Short Sale Process
1.
Talk to the Right Person - "Loss
Mitigation Department". Each lender may
have a different name for the persons handling
short sales. Make sure you are talking
with the person that has the authority to make
the decision. You may need to make a
number of calls before you get the person
responsible for handling short sales.
2.
Commission Negotiation - It does not
matter what commission the seller has agreed to
pay. The lender is the one who will be
paying the commission, not the seller.
Because the lender is losing money, the lender
is likely going to negotiate the commission
amount paid. Be prepared to discuss your
fees.
3.
Documents to Submit to the Lender -
There are a number of documents that must be
prepared and submitted to the lender. This
information is used by the lender to determine
the worthiness of granting a short sale.
-
Hardship Letter: Tell the
lender what happen to put you in this
situation. Lenders are humans and can
understand if you lost your job, had
hospital emergencies, and sudden
family tragedy like a death. The
sadder, the better. You want to make a
plea that gets the lender to accept less
then full payment.
-
Authorization to Release: This
gives the lender permission to talk with
other persons such as your real estate
agent, title company, lawyer, etc., about
your loan. The letter should include:
Property Address, Loan Reference Number,
Your Name, the Date, Your Agent's Name and
Contact Information
- Last
2 Paycheck Stubs: Lenders want
to know about your financial situation and
the amount of income you have.
- Last
2 Monthly Bank Statements: If
you have had large cash withdrawals, or
written an unusual number of checks, it is
probably a good idea to explain each of
those items to the lender. Also be
prepared to explain deposits in the event
lender wants to know the source of the
deposits and if they will continue.
- 2
Years W2 (most recent):
Lenders wants to know about your financial
situation and the source of your income.
- Last
2 Years Tax Returns: Lenders
wants to know about your income, assets and
debt obligations.
-
Detailed List of Monthly Expenses & Income:
Lenders want to know about your income and
expenses to determine if you really entitled
to a discounted payment.
-
Signed Listing Agreement: When
you have an agreement to sell with a
potential purchaser, the lender will want a
copy of the offer, along with a copy of your
listing agreement. Be prepared for the
lender to renegotiate commissions and to
refuse to allow payment of certain items
such as home protection plans or termite
inspections.
- Most
Recent Appraisal (if available):
You should include an appraisal, if you have
it, that shows the property's value is much
lower.
-
Comparative Market Analysis (CMA):
If part of your reason is due to declining
property value, use CMA to substantiate your
case to the lender. Be sure to include
listings that are active on the market,
pending sales and sold properties from the
past six months. You can also use a
recent appraisal.
-
Recent Mortgage Statements:
This helps to verify your loan information,
payments, and balance due.
- HUD
Statement from Last Transaction (if
available): If you have a HUD
loan, this helps to verify your loan
information, payments, and balance due.
The key is to
make sure you prove to the bank that the
seller is a candidate for a discounted payoff of
their mortgage. Lenders are not in the charity
business and often require assurance that the
debtor cannot pay back any of the debt that it
is being forgiving.
Get your
process and documents together and be
diligent with calling and following-up with the
lender.
Document Management
is a big part of handling short sales; and
it's included with your Realty Broker
Office™. There is
no additional cost for this features.
With Realty Broker Office™ there
are no setup fees, no contract to sign and no
maintenance fees.
And this
isn't
the only extraordinary feature you get.
With Realty Broker Office™ you get the complete
solution to manage and grow your business.
Click
here to view
other features
---
-- --- -- - -- - ---- -
Related
Feature: see
Getting Expired Listings to Call lets you close more deals
Other
Features:
see what else is included
Tell Others:
tell
friend, association, other brokers
|
