Short sale packet


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Overview of Short Sale Process By local expert.

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Short sale packet

  1. 1. Robbie McCarty Keller Williams Realty Cell: (757) 374-0005 Office: (757) 673-7488 Fax: (757) 673-7499 – Home Selling Services Information – Your Complete Guide To The Short Sale Process – Selling Your Home With No Equity
  2. 2. What is a Short Sale? A short sale is when your lender allows you to sell your home at a loss, and accepts less than what you owe on the property as a payoff The reason lenders allow home owners to do this is because they do not want to foreclose on properties. They would much rather allow the property to transfer to a new buyer, without having to take ownership. A short sale is really a win-win for you and the lender General Short Sale Information
  3. 3. Benefits of a Short Sale  You avoid foreclosure or no longer have to own a home that is a financial drain  You avoid the negative affects that bankruptcy or foreclosures have on your credit  You avoid the costs of selling a home with negative equity  Your lender recoups the market value of your home  Your lender no longer has an at risk loan and does not have to take ownership in case of foreclosure  You can move on with your life instead of feeling like you are stuck in your home
  4. 4. The Short Sale Process Steps to Completing a Short Sale 1. Find an experienced short sale Realtor 2. Fill out listing paperwork with Realtor 3. Start collecting your financial documentation for lender 4. Realtor will market home for sale 5. Receive an offer on your home 6. Agent reviews contract and structures it in your best interest. 7. Agent sends offer to lender with your financial package 8. Lender reviews package, order BPO’s and terms of sale are negotiated. 9. Buyer completes inspections and closes on home
  5. 5. Communication The short sale process requires the buyer to wait up to 60 days for bank acceptance so proper communication is critical  I will update you every time the home is shown  When we have an offer I will communicate with the lender twice per week  I will communicate each lender correspondence to you  I will communicate twice per week with the buyer agent  I will communicate with the BPO agents to ensure we receive the right valuation
  6. 6. Documentation Needed 1. Hardship letter signed and dated 2. Paystubs from last month 3. Last two years of tax returns and all schedule forms 4. Last two months bank statements all accounts with name (Not online statement) * I will let you know as additional documentation is needed
  7. 7. Short Sale FAQ Why would my Lender want to allow a Short Sale to help me? The reason is simple; a short sale often has a better return on investment to the lender than a foreclosure. The average savings a lender sees from a short sale property compared to a foreclosure property is $14,000. Not only does the lender receive this savings, they are also paid on the loan 6 months earlier than in the foreclosure process. This allows them to collect and cash-out earlier than they would in a foreclosure. Plus, lenders spend a great deal of money with attorneys to complete the foreclosure process. Lenders created the short sale process as a foreclosure alternative for those reasons. The incentives to perform a short sale on your property are in place to motivate you to participate. When should I start my Short Sale? It is best to begin a short sale when you realize you can no longer afford the mortgage, so that your property can be marketed properly and you can receive a high offer. The earlier you start, the higher our likelihood of success. Contact us to see if you have enough time.
  8. 8. Short Sale FAQ How long does it take for you to complete a short sale once we fill out the paperwork? Typically transactions are completed within three months. If you have a foreclosure sale date approaching we will attempt to complete it sooner. We have often found buyers quickly and have used our relationship with the banks to push back your foreclosure sale date. Why should a lien holder accept less than the outstanding debt? After the lender does an appraisal on the property and discovers that the value is less than the payoff, the lender will decide if it is worth further legal actions and cost. A business decision is made to either continue foreclosure action or accept the short sale offer. What is the difference between a Satisfaction of a Lien vs. a Release? A satisfaction is a total release from the debt owed. A release is when the lender releases the lien from the property to allow the home to be sold. (The borrower may still be required to repay the balance of the debt.)