Talbert Real Estate Group

~Short Sales Nuts and Bolts~

What is a Short Sale?

A short sale occurs when the homeowner owes more on their

property than the property is actually worth, but their Lender agrees to accept less than what is owed as

payment in full.

What Qualifies a Short Sale?

The Homeowner is in default with their mortgage or is about to fall behind in their mortgage payments

(Default is 30 days behind in your payments past the lender’s grace period)

There is little or no equity in the property.(Market value of the property is less than or about equal to what is owned)

….Qualifying Criteria continued

There is a legitimate hardship.

-Temporary or permanent job loss - Divorce -Illness or Death -Decrease in property values -Significant cut in pay -Increase in property taxes -Increase in payment due to ARM reset

Seller Work Out Package

• Authorization to Release Information:• Do Not Contact Me: Both will stop the bank from calling you & they will begin communicating with me

• Client Information: There is a list here of all the items you will need to include in the work out package

• Financial Statement: Complete all 3 pages and sign

• Hardship Letter: There are several examples included in the work out package

Additional Documents Needed

• Copies of Tax Returns (last 2 years)

• Copies of all Bank Statements (last 2 months for all borrowers)

• Copies of all Pay Stubs (last 2 pay periods for all borrowers)

Note: Self employed? Tax Returns or Profit and Loss Statement will workMissing anything? A Brief Explanation can be provided

Contact with Lienholder(s)

• I will contact the Lienholder(s) and notify them of the short sale.

• At this point, telephone calls to you from the Lienholder will cease and I will begin communication.

• If a 2nd mortgage is part of the equation, I will negotiate a payoff with this party first.

The Process

• List the property for sale in the Multiple Listing Service

• Home will be shown by Realtors to potential Buyers

• An offer is submitted and agreed upon between the Buyer and the Seller

• The offer is submitted to the Lienholder for approval

The Process continued

• The Lienholder orders a BPO (Brokers Price Opinion, similar to and appraisal) Once the report is received by the Lienholder, they will issue an approval letter shortly after.

• Close of Escrow requires documents to be signed by you, the Seller, at the Title office.

• We can accept more than one offer and we should. (2nd offers will be placed in back-up position)

Your Responsibilities

• Keep copies of documents pertaining to the sale.• Contact me if you have a change of address.• Try not to incur any new debt and keep low balances on credit

cards; keep payments up to date.• Pay your rent by check or some way that can be tracked.

(All of this will help you in the future, should you choose to purchase a new property in the future.)

Questions ??

• The Work Out package is needed 24 hours before we place the property in

the Multiple Listing Service.