A short sale may have credit or legal consequences and may result in taxable income to Seller. The Seller is advised to seek advice from an attorney, certified public accountant or other expert regarding such potential consequences of a short sale.

We will help provide you with an education of the options and alternatives to a short sale. 

The first thing you need to know and understand is how to go about keeping your property.  Once you are informed about these alternatives and consequences, you will have a much better idea about the decisions you will make going forward! 

A SHORT SALE is when a bank is willing to sell for less than what is owed.

Should you decide to follow through with a short sale, the following is a BRIEF description of the process you may go through with your REALTOR® (REALTORS® may use different approaches in terms of how they like to move forward through the short sale process).

This is how we have found success:

1) Discuss your potential Short Sale with your REALTOR® and go over all alternatives and consequences ~ make an informed decision about moving forward with a short sale. 

2) If you elect to apply for a Short Sale, list your property  

3) Authorize your REALTOR® to discuss your mortgage/account with the lenders involved in the form of an "Authorization Letter".

4) Begin gathering your Short Sale Package documents, which may include the following:

  ~ Sellers Hardship letter

  ~ Sellers Financial statement / information

  ~ Any Supporting Hardship information - HOA liens, medical statements, disability statements

  ~ Supporting Financial Information - 2 years W2's, 2 monthly paystubs, 2 months bank statements, 2 years of Income Tax Returns

5) Submit short sale documents to your REALTOR®

6) Receive offer(s) 

7) On-going communication with your REALTOR® keeping you up-to-date with status of your short sale application with all lenders involved, requests for additional information, or timeframes as they change throughout this process due to delays in responses from any party, or due to very prompt responses!

8) Acceptance, Counter Offer or Rejection of accepted offers from lender (includes negotiations)

9) Once acceptance received, we revert (so-to-speak) back to a 'normal' transaction where contractual time periods begin ~ ie: seller disclosures provided to buyer, buyer completes all investigations and inspections, buyer removes contingencies, buyers loan (if any) funds and escrow records and closes.

10) Close escrow

In our experience, this process can take anywhere from 1 month to 7 months!  We can not stress enough to all buyers making an offer on a short sale that they need to be prepared for such a lengthy timeframe.  On the flip-side, it can also move very quickly and we can not stress enough to all sellers to be prepared to vacate their premises in a very tight timeframe.  We've experienced a short timeframe of 2 weeks and have heard of even shorter than that!

Here is a brief list of the items that your REALTOR® may need to compile for the short sale application to submit to the lender:

1) Copy of listing agreement

2) Copy of purchase agreement (including Short Sale Addendum)

3) Copy of Earnest money deposit

4) Lender Pre-approval in cases where buyer is financing / Verification of funds in cases of an all-cash offer

5)Sellers Net HUD-1

6) CMA

7) Any and all other documentation necessary in order to help facilitate the lender's acceptance 

The information provided in these foreclosure/short sale pages has come from not only our experience, but the Certified Foreclosure Specialist course provided by ForeclosureU.com.