Short Sale Files Contain Information on the Seller’s Finacials, The Buyers info and Info on the Short Sale Offer
Folsom Short Sale Specialist Forth Hoyt Answers more questions about short sales.
I have completed nearly every Short Sale Certification and Designation class I have ever come across. I love to learn and I am driven to understand, share my knowledge and teach my clients and prospects.
I closed my first short sale in 2006 and have now closed more short sales than nearly any other Short Sale Agent in the Folsom Area. I can truthfully say there is not a question about short sales I have come across in several months that I didn’t know the answer for or at least knew where to get the answer quickly.
I am constantly getting questions on Short Sales and especially from people in the Folsom Area Considering a Short Sale.
One of the most frequently asked questions I get is “what information will the bank need for a short sale and when do I need to send it to the bank?”
Here is how I answer those particular short sale questions:
A short sale is actually two transactions happening more or less simultaneously;
The FIRST part of the TRANSACTION is just “Real Estate 101″… it is the transaction between you, (the seller) and the buyer.
Just like any other real estate transaction, this requires the listing agreement, sellers disclosures (provided by you) and also the Natural Hazard Zone Disclosures typically provided by a third party.
The short sale transaction requires exactly the same documentation as any other Real Estate transaction with one additional form required; The Short Sale Advisory and Addendum. This document stipulates that there is no Ratified Contract until there is “third party approval” (until the bank says o.k.).
The Short Sale Offer must represent the highest sales amount possible for the Mortgage Holder “Investor” or they may opt to take the property back in foreclosure and market it themselves… So it is imperative that the short sale seller picks an agent with both great marketing ability and negotiation skills.
The SECOND part of the TRANSACTION is between you, (the seller) and your mortgage holder(s): also known as the “investor”. This transaction is handled by the Servicer (the entity you actually make your payments to or “the bank”) and may also any Mortgage Insurance Company that either you the seller or the mortgage holder “investor” may have placed.
If you have more than one loan, both Investors and both Servicers and both Mortgage Insurance Companies and any other lien holders you may have will be involved and must give their OK to the sale-
This is where your Short Sale Specialist makes a difference. Our education, designations and experience are used to negotiate and achieve the best results for you and your family, as well as your mortgage holder and the buyer.
In order to get your file assigned to a short sale negotiator, an entire, complete, concise, indexed and well organized “Short Sale Package” must be submitted to your bank(s).
Your part, (the seller’s part) of this package includes;
1. Two Most Recent Pay Stubs
2. Last Two Months Bank Statements (all pages, even if blank)
3. Last 2 years Tax Returns (All Pages, must be signed, even if Electronically filed.)
4. Hardship Letter (must be dated and signed)
5. Financial Worksheet (USUALLY Bank or Servicer Specific)
In most cases, there are additional documents needed, each bank/ servicer has their own guidelines and required documents. These additional documents will be provided by us and may include:
7. RMA (Request For Modification Form)
9. Hardship Affidavit
11. Hardship Worksheet
12. Copy of your most recent mortgage statement.
4. Utility Bill (ONLY FOR HOMEOWNER OCCUPIED: TO PROVE YOU LIVE THERE)
5. 2009 and 2010 W2’s
The ‘Short Sale Package’ is a compilation of:
(a) Your Financial Information (above)
(b) the buyer’s offer, signed and accepted by you, the seller, as well as proof of funds and/or approval letter from the buyers lender
(c) a NET SHEET (prepared by a Title Company) showing what offer will “net” the bank, according to the offer and the allocation of closing costs (the bank will pay all of your closing costs out of their “net”
(d) a copy of the listing agreement,
(e) a copy of the MLS listing, and the MLS history and showing report
All of this information; usually several hundred pages is faxed/emailed or uploaded
to the bank/ servicers and the short sale negotiations begin.
Questions on government Short Sale Programs?