The Art of Short Sales

Working with short sale properties has become an art. I have written offers to purchase dozens of homes, contingent upon lender approval, in other words, a short sale. Less than one out of twelve has successfully closed.

I have witnessed a lot of blame pointed at the banks, rather the agencies, who process short sales for the banks. They claim it takes a long time, or the agency never responds. These are the deals that will never be completed.

I have also listed a number of short sales. I have been in the position of supplying, what seems like a never ending stream of paperwork to bank affiliates. I know the process takes a large amount of time, patience, and attention to detail. This is why I know short sales require a highly dedicated and motivated agent.

Following is a brief list of the information required to initiate the process of a short sale.

Comparable Market Assessment (CMA) to estimate value
Search and Hold / Title Report
Listing Questionnaire Regarding Title Issues
Net Sheet to project Seller’s Proceeds / Deficits
Mortgage terms and conditions

Forbearance agreements to temporarily suspend loan payments
Repayment plans with the Seller’s Lender(s)
Loan Modification
Refinancing with the Seller’s lender

Listing Contract and Addendum SSL
Seller authorization to negotiate with Seller’s Lender(s)

Pay Studs and W-2 forms
Bank statements
Financial Statements
Cash Flow Analysis
Hardship Letter

As you can see by the above list, short sales require a large amount of paperwork. The main reason most short sales fail is due to incomplete or missing forms. Unless the Lender has a complete file, there is no chance of proceeding to the next level.

Be aware, entering into a short sale requires disclosure of sensitive financial documents. For this reason it is important to deal only with local, state licensed individuals with fiduciary duties. This means, they have license agreements with the state, agreeing to safeguard your personal information. Many Internet web sites will do nothing more than gather your personal information and sell it to anyone willing to pay.

Before considering a short sale, talk to a local HUD authorized agency. These agencies are experts in the field. These services are often free. More than 80% of their clients have lost money on Internet scams before contacting them.

I have no problem admitting my limitations. I do not list homes for short sales. I have worked with a number of agents specializing in short sales in Milwaukee, Menomonee Falls, Brown Deer, Greenfield, West Allis, Franklin, Oak Creek, Hales Corners, Germantown and other parts of Milwaukee, Waukesha, and Washington Counties. I would be happy to talk with you about your situation, and begin the initial process. Once we have gathered all the facts, and exhausted possible options, I will make a recommendation for the agent whom I feel is best equipped to handle your particular situation.