5 Things You Must Do to Complete a Short Sale
Hopefully this topic won’t be so relevant soon, but for now it is still a big issue for many people. I have helped several homeowners through this difficult process over the last couple of years. Some short sales closed relatively smoothly – others didn’t work out so well.
Here are 5 important ideas to take away from my experiences:
1) Find an experienced Realtor to list your house. Not just any experienced Realtor, but one that has successfully closed short sale deals. If you can find one that has closed a short sale with your mortgage lender – that would be best. This can be a complicated and frustrating process. You’ll want an agent who has been through this before.
2) Put together your hardship package. Your lender is going to require current income and asset documentation (paystubs, bank statements, etc.). A valuation of your property will also be ordered. You must also write a hardship letter, detailing the circumstances that brought the need for a short sale. Don’t hold back. Tell the truth, no matter how difficult or embarrassing this might be for you. Believe it or not, lenders are not all cold and callous. There are real people on the other end, and they do understand. Here are examples that might qualify as a hardship:
• Reduced income (furloughs, new job, partner’s loss of job, pay cut)
• Illness or medical emergency
• Job transfer (voluntary or involuntary)
• Divorce, separation or marital difficulties
• Exotic mortgage terms (an adjustable-rate loan)
• Military service
• Death in the family
• Increased expenses and excessive debt
• Unexpected repairs or home maintenance
3) Locate your lender’s Loss Mitigation Department (workout department). This is extremely important! Do NOT call the loan officer that closed your loan. The friendly customer service rep that answers the bank’s 800# likely won’t know. You must find the office that handles Loss Mitigation (short sales, foreclosures, etc.) for your region. These are the people you need to talk with. They are the ones that handle short sales.
4) Be Proactive. Once you are working with someone in your lender’s Loss Mitigation Department, call persistently to follow up. Be polite – but be persistent. Also, be prepared to explain your scenario over and over again. Your lender might have several people working as a team, and each one might be hearing your story for the first time.
5) Be Patient. I know this is easier said than done. The short sale process can take several months. There is a lot of work that goes into closing a short sale deal. Work patiently with your agent and your lender. Have a mindset of cooperation, even if your lender challenges you or information you send them. Work through it, and focus on the end result of selling your house.
Have you worked on or through a short sale? Please comment if you have anything to add.