It is very important to have a realtor by your side when you plan to go for the option of short sale. However there are things which you have to be aware of yourself. It involves transactions and formalities which can be very difficult for you to handle. However with the following tips you may make the most out of it and help the negatives turn in your favour:
1. Conduct a pre-screening of your listing: It is important to consider the fact that the transaction for a short sale listing would close through an escrow successfully. This should be done before going for the short sale listing and needs an answer to the questions such as the shortfall which the lender would need to approve, the nature of seller’s hardships, the time you have before the homemaker can go for the foreclosure, etc.
2. Taking the consequences into account: It is very important that the seller takes into account the possible consequences amounting out of the short sale of home. The questions like, if they have explored the alternatives such as refinancing as well as loan modification has been explored needs to be answered. As it’s known, there are several tax and credit liability which is involved, therefore homemakers should take the advice from attorney or appropriate professionals.
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3. Conduct a detailed research: It is very important that you go through the MLS rules & regulations for being sure while entering a short sale listing in a specified manner. It would be advised to acquire as much knowledge as is available from any source you can come across. These may include the public records, title searches or the neighbourhood comps. One of the other things which you should do is continuously monitor the process so that the property is not taken over by the bank while you are in the midst of closing the escrow.
4. Using the C.A.R.’s tools: There are various free tools which are made available from C.A.R. which includes the articles, standard forms, and other similar tools. It would be wise to complete and then attach the Short Sale Information Advisory form for the listing agreement along with the C.A.R.s Short Sale Addendum. Moreover the provision of a copy of SSIA to the buyers containing useful information regarding the process is also advisable.
5. Submitting a complete package: One of the things which should be considered is the quality of short sale package. It is one of those things which can make or break for the lender approval. A complete short sale package would include the hardship letter, paycheck stubs, neighbourhood comps, condition of the property, CAR’s authorization for releasing and conveying the information, tax returns, etc. Another thing which the lender would ask you is showing the listing if marketed and negotiated at the best price and terms.
6. To be proactive: In the past it has been observed that the success of the short sale agents is usually attributed towards personal tenacity as well as perseverance. It is advised that you begin the short sale process as fast as possible and monitor it on a regular basis. Moreover you need to ask every question that comes to your mind and document all the conversations which you have witha short sale lender.
7. Take care of multiple lienholders: It has been seen that a transaction that needs a single lender approval is much easier than the one involving multiple party approvals. Therefore, if there are several parties for a single property then submitting the short sale request to each of them of the lien holders as well as the creditors should always be done.
Hence, with the above things in mind and some other measures the process of short sale could be way simpler.
The author is an avid blogger and has submitted articles to many leading finance blogs. You can visit his website if you Need to short sell or need advice selling your real estate property.