What is a Short Sale?

A short sale is where a property is sold for less than it is worth. The lender must agree to the short sale, and a process must be followed.

1. The homeowner must be deemed in a distressed state, behind in payments, and the property is usually faced with threat of foreclosure.
2. Documents must be completed to prove the homeowner cannot continue mortgage payments, a letter explaining the cause of the financial distress is usually required.
3. Efforts must have been made to sell the property at its full market value and a detailed report of the sales activity supplied.
4. If the lender approves the short sale, a buyer is found, and a price is agreed upon. Then the sales process would continue as a normal sale would.

Many times the lender will pay almost all of the seller’s required fees and commissions. The homeowner may walk away owing nothing, but they cannot walk away with any proceeds. The process from start to finish can take anywhere from 3 to 12 months, and the help from a Certified Distressed Property Expert© can be invaluable.

The Short Sale Process

As the homeowner begins working with our experts we will guide them through to initiate the short sale successfully.

In Preparation:

• Our expert will visit the property for an initial appointment where they will answer any questions involved in the short sale process.
• We will prepare the photos to use in marketing the property.
• A damage and repairs review will be initiated to state any issues with the property that need to be used in negotiations with the lender.

Marketing Steps:

• The property will be listed for sale in the MLS.
• Our team will begin their marketing strategy.
• A line of communication will begin between the lender, the homeowner and our expert representing you.
• The property will be shown as much as possible, and the asking price will be reduced every 15 days (on the 1st and 15th) until a viable offer is received.
• Offers are given to the homeowner for review and signature, and are then submitted to the lender.

The Lender Negotiation:

• If the offer is accepted it will be signed and a contract begins.
• The lender will require copies of bank statements and paycheck stubs.
• Any additional documentation is completed and returned in an expeditious manner.
• Our experts will submit the Short Sale package and all required documents to the lender.

After the offer, the lender can choose to accept or not. If the offer is accepted, the closing can begin. The closing will be scheduled with a title company, at which time the buyer can make any final inspections. Homeowner will leave the property broom swept and completely empty, unless otherwise noted. The buyer and homeowner both meet at the title company to sign final paperwork and turn over all keys and remote controls. The title is then transferred, and the new owner takes over the property. The lender issues a mortgage satisfaction and the document is recorded in public records. If the offer is not accepted, the lender may make a counter-offer. If that counter-offer is accepted by buyer, the process with continue. If the buyer does not accept and no amount can be agreed upon, the property goes back on the market to await a suitable buyer.

To make the process easier to understand and undertake, the property owner would benefit by contacting our Certified Distressed Property Experts©. Call us today at 425.454.4141, or send us more information and we'll contact you as soon as possible.