There are actually hundreds of steps to successfully completing a short sale. But, you probably wouldn’t read this article if I covered that many steps. So, let’s boil it all down to 5 simple steps.
1. List your home with a short sale expert.
Your lender is going to require that your home be listed. Be sure to list with a Realtor who specializes in short sales. This isn’t the time to list with a friend or even a relative. Short sales are too complicated for the inexperienced agent.
I work in the Bradenton - Sarasota, Florida market, but the short sale process is the same nationwide. Know that it takes an incredible amount of time, effort, and expertise to negotiate with the lender and get the job done. If you need help finding an expert in your area, please contact me, I can help.
2. I will market the home and find a buyer for your property.
Without a buyer there is no short sale. You will want to price the home agressively below your competition to attract a buyer in a short amount of time. Remember, time is working against you and that your goal is to be relieved of the debt. Don’t make the mistake of pricing the home as you normally would. Be very, very aggressive with the price. This is where your Realtor can offer expert guidance.
3. I will help you prepare the short sale package which is submitted to your lender.
Once a buyer is found and the contract is executed, it’s time to submit the “short sale package” to the lender. The documents to be included in this package are described a little later. Right now, just understand that until a buyer is found, there isn’t much to do. However, it is important to gather all the documentation that will be required. I will provide you with a list of the required documentation.
4. Your lender will order an appraisal or Broker’s Price Opinion (BPO).
The BPO is conducted by a real estate agent hired by your lender. It will most likely be a drive-by BPO unless the condition of the property warrants an interior inspection. The purpose of the BPO is to determine the property’s fair market value. This will be the pivot point for the lender’s negotiation regardless of the purchase price on your contract.
5. Your lender either approves, rejects, or counter’s the buyer’s offer.
Most of the time you can expect the lender to make a counter offer. I will negotiate between your lender and the buyer. The buyer will decide whether to accept the lender’s offer, reject it, or make a counter offer back to the lender. Just remember, the lender has the final say and must approval the sale.
This process can take a week, a month, or several months depending upon many factors. It’s important for all parties to know that this is a lengthy process and that patience is a virtue.
(Copyright © 2007 By Dan Forbes, All Rights Reserved.)
