A short sale is necessary when the homeowner is facing a possible foreclosure (due to circumstance) and selling the home would not yield enough to pay back the lender in full. A short sale is a considerably timely process that needs the permission of the bank. Basically, the bank needs to agree to”forgive” the remainder of this loan that will stay outstanding if you sold it, and let a new buyer to take over the home with a fresh loan. Because banks do not want to own homes, short sales are usually approved; it is, but not an easy process and requires skill and expertise.
Compose a hardship correspondence. This is instrumental in getting the bank to consider forgiving the amount you will pay following the purchase. It has to be expressed that your financial circumstances have changed, and ; it should also show that you are struggling now, and will continue being unable, to pay the mortgage had initially been promised, for the foreseeable future.
Employ an expert real estate agent who has successfully finished short sales before. You will be authorizing this agent as your agent in the transaction with the bank. The more experienced this agent is, the easier the process will be. Agents should keep together with the banks to make sure the bank does not drop the ball on short sale approvals and move the home into the foreclosure procedure.
Divulge all information pertinent to a house to your own agent. Signal an”Authorization to Release” into the bank indicating that the agent can act as your trustee and is approved to deal with negotiations with the bank on your behalf. A house with more than one mortgage is not as likely to get approved for a short sale; the more loans you have on the house, the harder it’s going to be to get all of the banks involved in the debt.
List the home as a short sale and cost the home rather. The cost of the home ought to be in fair market value. List the home in too high a cost will yield no buyers, and listing it too low to be able to protect buyers will probably end up with a rejection in the bank.
Prepare a short sale package to submit to the bank. Once you’ve secured an offer from a couple of buyers, this has to be included in the short sale package as well as a thorough market comparison and analysis that reveals the bank that this is, really, the best solution for your bank to mitigate its losses in this circumstance. Get as many qualified and/or preapproved buyers as possible; leave the home cost blank on the sales contract, since the cost may have to be corrected during negotiations with the bank.
Have your real estate agent contact the”Loss Mitigation Department” in your bank consistently. There are instances where the short sale was approved just days after the home was foreclosed, so maintaining contact with all the bank is a must in successfully finishing short sales. Once your short sale is approved, you may generally have 30 days to complete the sale via escrow; prompt focus on this matter is critical to finishing a short sale.