What are the Benefits of a Short Sale?
When a Short Sale is achieved, there will not be a foreclosure. If a property is foreclosed, owners may owe deficiencies and other expenses to the lender. Under most short sales we process, the homeowner may be relieved of this possible future burden.
All information contained herein is for informational purposes only and is not intended to offer advice -- legal, financial or otherwise -- about specific situations or problems. Information is deemed reliable but not guaranteed. Always consult a professional before making decisions about your real estate situation. For consumer use only.
How Much of a Discount Will the Bank Take?
The banks or lien holders work around current market rate.
Can Investment Properties be Short Sold?
Most definitely. Any type of property can be sold through a short sale.
What is the Short Sale Process?
Upon receipt of a complete short sale package, if like most lenders, the lender does not take electronic paperwork, we will fax the complete Short Sale Package to the lender and confirm receipt. The amount of time varies for the bank and/or lien holder to upload the packages onto their system. Once they receipt is confirmed, we ask the lender with the first mortgage to order an appraisal or a Broker Price Opinion (BPO), and request that a negotiator be assigned. Once a negotiator is assigned they review the offer. During this time we continue to check back regularly. Once they deem the offer as Bona Fide, they submit the offer to the investor (the actual owner of the mortgage) for final approval. This can take up to 30 business days.
After an Approval is Issued, How Do We Close?
Once the approval is received, the lender's approval will give the parties a maximum of 30 days to get the deal closed (it is occasionally shorter). Sometimes, if you are getting an FHA loan you will get additional time with no penalty towards commission. If you need an extension banks usually charge. For this reason, it is very important to close on time. We will give you an indication that an approval is forthcoming so that everything can close in the time allotted. Neither the lender nor the title and escrow company can close overnight. The title and escrow company must get the HUD-1 to us for approval 72 hours before the closing. This allows us time to submit the file to the lender so that there are no surprises at the closing table.
What is the Most Important Thing that an Agent Can Do?
Price the property correctly and to explain how and why the market responded to that price. The lender will not take anyones word that any contract price is a fair price. They will verify the price by sending out an appraiser or an agent they hire to do a Broker Price Opinion or BPO. It is imperative that agents research the property value and get the best info on the value. Then meet the BPO agent at the house with your CMA, using low price comparables. As the property is being sold in as is condition, show the BPO agent the repairs and improvements that need to be made that might not be so easily seen in a quick inspection. Finally, explain to the BPO agent how you ended at this sales price.
What Forms does the Real Estate Professional provide?
Forms Needed from Real Estate Professionals:
RealDoc Service Agreement
Authorization to release information for each lien holder
Residential Listing Agreement
Listing Agency Disclosure
Selling Agency Disclosure
Fully Executed Purchase Agreement
Buyer approval letter from lender
Proof of buyers funds
Short Sale Disclosure
What Forms does the Seller/Home Owner provide?
From the homeowner we will need a hardship letter, a financial information form, and the last two years of federal income tax returns (first two pages only), the last two months' bank accounts, and the last two pay subs of each borrower. If the homeowner does not have any of these statements, they will need to provide a short separate note stating why they do not have these documents. For a list that outlines what we need from the homeowner, please see below.
Other Needed Forms from Homeowners:
Detailed list of Expenses - Month/Year
Utility bill (with property address/seller name)
Hardship letter
Seller's last two bank statements
Copy of last 2 years tax returns
Copies of two months pay stubs
Self employed P&L if applicable
Copies of Mortgage Statements from all lien holders
HOA if applicable (copy of last statement with name/phone)
IRS Form 4506T signed by seller
What is an Acceptable Hardship?
Need to move from a home.
Reduced Income or Unemployment.
Inability to work due to health reasons.
Separation or Divorce.
Medical Bills.
Business Failure.
Death of a Spouse.
Adjustment in mortgage payment or unforeseen increase in monthly expenses.
Any other circumstance that can hinder someone's ability to repay their mortgage.
Can you explain all the paperwork and how I submit it?
Yes, please call us 619.819.7040
Complete sets of paperwork should be faxed to 858.412.4770 or E-mailed as a PDF to Info@RealDoc.net.
Have Any Other Questions?
Please email us at Marcela@RealDoc.net or call 619.819.7040 and we will answer them promptly.
How Do I Call You?
Please call us at 619.819.7040.
How Do I Submit Forms?
Our Fax is 858.412.4770. You can also E-mail us at Submissions@RealDoc
