Short selling is a unique process where certain specifics must be met in order to proceed. If the home still provides enough value for the bank to break even by going to foreclosure, then a short sale may not be possible. However, this isn’t set in stone — every bank and every agent is different, so even if you think you don’t qualify, it couldn’t hurt to ask.
However, because of this guideline, the first step is to evaluate your home’s worth. Is your mortgage upside-down in its property value? Then you’ve cleared the first hurdle. After that, it’s important to contact your bank and learn what their specific guidelines are for a short sale. Use this as a checklist of documentation and information you’ll need to prepare. Since short selling is a mutually agreed-upon process, you’re going to need to thoroughly convince them.
In general, this comes in a package that demonstrates both your financial hardship and the home’s property value. You’ll have to include everything from bank statements, tax records, employment history, legal status changes, and other such official documentation to show that you can’t pay your mortgage. The package will also require a cover letter explaining your financial hardship.
Other factors include junior lien holders, state regulations, and inspections. Again, every bank is different, and this information — both what you need to provide and when it factors into the process — should be clarified up front. Assuming it all looks good, you can submit your package and supporting information to the lender.
If the lender accepts, then the process may turn in a number of ways. Many banks have their own preferred short-sale agent, but you may also be involved in the search for one. As with all legal dealings, if you feel uncertain about any of this, it’s best to hire a real estate attorney if you think you have a good case to short sell.
And if the bank rejects your short sale proposal, it’s not the end of the world — you can always try to get a loan modification.
Israel Gonzalez RDCPro, CDPE
Real Estate Broker
831-636-8858
http://www.bestreohomes.com/ http://nicereohomes.com
The views published here are the opinions of the writer and are not a substitute for legal counsel.
