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Dealing with short sales

 

Short
sales are becoming much more frequent in the United States, mainly because they
are an alternative to foreclosure. 
Homeowners who are facing foreclosure are looking for ways to keep from
damaging their credit, and a short sale does just that.  Quite basically, a short sale is when the
lender agrees to accept an amount less than what is owed on the property
loan.  It is important to understand that
not all lenders will accept a short sale. 
In this article, you will learn some information about short sales and
how to deal with the process.

 

If
you are considering a short sale, you should first call the lender that is
holding your mortgage loan.  You need to
specify that you need to speak only to someone who handles the short sales for
the company.  Be prepared to be put on
hold, transferred, and even disconnected a ton of times before you get to the
right person.  You may even have to
explain what a short sale is to the person on the other end.  You do not want the general department
either.  You should ask to speak directly
to the supervisor of the short sales department.

 

Your
next step is to send in a written letter of authorization.  This will give the lending company written
permission to disclose any pertinent information to the parties that request
it.  You should include your name,
address, the date, and account number. 
You should also have the document notarized, just to be on the safe
side.  Make a copy for yourself.

 

Somewhere
along the way, you may find that you need a real estate lawyer.  It would be best if you contact one as soon
as you start looking into a short sale. 
The lawyer can help you through the process.  When you contact a real estate lawyer, you
need to ask them to prepare a preliminary net sheet for you.  This document is a bunch of fee calculations
that show the price you expect, the costs associated with selling the home,
unpaid money you owe, and back payments and late fees.

 

You
will also need to provide a written hardship letter.  The best tip that you can get for writing
this letter is to be as pitiful as possible, within reason of course.  Do not simply say that you lost your job and
cannot pay the full amount.  You need to
include other hardships that you have suffered as well as the loan problems.  If you have children, you add them in
somewhere as well.  It sounds awful, but
you need to play the sympathy card here.

 

In
many situations, you cannot sell the home for the amount that is owed.  The market rises and falls so quickly, but
when it falls, it stays down for awhile. 
This is usually the main reason for a short sale.  It is simply impossible for you to pay the
amount that is still owed on the loan because the house will not sell for that
much.  In this case, you can obtain a
comparative market analysis from the real estate agent.  If you provide this document to the lender
with any other documentation that they need, you are more likely to get the
short sale approved.

 

Short
sales can be a headache, not just for you, but for the real estate agents as
well.  There will be tons on paperwork
and records that you will need to fill out and send in, but just keep in mind
that lenders tend to look at short sales as a way for them to lose money so
they will be rather demanding. 

 

Keep
your patience and provide what you can. Be sure, better days are ahead………

Sign up for more information at www.investingwiththestars.net/season2

Nancy Geils


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