10 Curcial Short Sale Selling Tips For Sellers And Their Agents
From the Short Sale Seller's Guide
This is a list in part taken from recommendations made by a major mortgagor and servicing company whis is currently dealing with a good number of short sales. Overall these tips are geared toward agents processing the short sale, but you as a seller and/or buyer will benefit by knowing these. Even if you hire an agent you need to know how the process works.
1. Educate yourself about the short sale process.
Increase your knowledge of short sales and become an expert on banks process. Eash lender has their own process and a key to more efficiency, less stress and success is knowing how a particlular lender process the short sale and holding your self and the bank to it. The more you understand about short sales, the better you’ll be able to navigate and facilitate the flow of the transaction.
2. Set homeowner expectations.
It’s crucial that you as the homeowner and all parties involved understand the nature of a short sale transaction.
More paperwork is required and approval and cooperation are needed from multiple parties, including investors, lien holders and mortgage insurers.
This added work and paper trail increases the possibility that there may be delays in the process and the transaction will take longer than a typical home sale.
3. Make sure additional liens are released.
Identify all liens on the property and seek release for those that are not serviced by the lender. This could be mechanic's liens or unpaid recorded HOA dues or even city violations that have been recorded against the property.
4. Submit an offer that reflects fair market value. (Crucial)
The most significant factors for investors (note holders) when weighing approval of an offer are the net proceeds from the sale. Submitting low offers can result in immediate decline. So don't, as a seller, even accept an offer that is too much below market value even if your agent pressures you.
5. Verify purchase offer is complete before submitting.
Offers must include appropriate addenda and be signed by the buyer and homeowner and include proper documentation proving the buyer's ability to obtain financing or proof of funds if cash.
6. Negotiate third-party fees in advance and supply a completed HUD-1.
Negotiate external fees prior to submitting the HUD-1 Settlement Statement. Be sure that the HUD-1 Settlement Statement is valid for at least 60 days and all information is transferred to the Offer Worksheet in the short sale processing system.
7. Review all documents before uploading them into the short sale processing system.
Check all documents for accuracy, completion and clarity. When prompted by the short sale processing system, upload each document as a separate PDF file.
8. Complete assigned tasks quickly.
(This is your agents job and his/her job to communicate this to you) Check your messages in the short sale processing system often and complete assigned tasks as quickly as possible. Files not completed go on the bottom of the file so to say and delays will occur.
9. Obtain approval on counter-offers before accepting.
Counteroffers should be approved by all parties and the contract should be updated prior to acceptance. In other words have a completed fully accepted offer.
10. Notify the processing company (lender) immediately if any of the following occur:
- Change in buyer(s) - A change in buyer at any time may require the initiation of a new transaction.
- Homeowner files bankruptcy — If the homeowner has filed bankruptcy, the trustee must provide a court document that approves the sale of the property.
- Change in the closing date.
- Change to the deal after the approval letter is issued.
