A short sale means that you have received permission from your mortgage company to sell your home for less than the amount outstanding on your home loan. Thus, the fair market price falls “short” of the amount currently owed. The following will give you a brief idea of how the short sale process works. Remember, it is always recommended that you contact an experienced short sale advisor. Short sales can be extremely complex and can have tax and credit implications that is best discussed with a professional. Contact us today for your free consultation!
The Short Sale Process
- Submit 3rd party authorization
- Seller submits a completed Short Sale packet & requested personal and financial documents (including all lender specific documents)
- Agent submits signed around offer & listing documents to our office (when received) with buyer’s pre-approval
- Lender will review authorization, package and offer. This review can take up to 30 days. The negotiator calls in weekly on every file for updates pertaining to that file to monitor the process. The lender may ask for further or more detailed documentation for your file.
- The appraisal or value of your property will be ordered by the lender. When the value is determined they will do one of the following: Accept the offer, counter the offer with a higher price, or deny the offer.
- If the offer is accepted, the lender will issue an approval letter and the transaction will need to close prior to the expiration date.
- If the offer is countered, the lender will call or email the negotiator to advise that a new figure is desired. We will then go to work with the agents to determine if the higher price will be accepted by the buyer. If all parties agree, an addendum will be signed reflecting the new sales price and submitted to the lender along with a HUD-1 statement showing the new price.
- If the offer is denied, the lender will advise us via phone or email. Depending on the reason for denial, we will review to keep the file open.
- Once the price is agreed upon and accepted by the lender, there may be other things that need to be addressed such as any judgments or liens.
- The buyer secures the financing and the transaction will close once the buyers and their lender is ready. Sellers and buyers sign closing papers.