Lenders often have loss mitigation departments that evaluate potential short sale transactions. The majority have pre-determined criteria for such transactions, but they may be open to offers, and their willingness varies. A bank will typically determine the amount of equity (or lack thereof), by determining the probable selling price from an appraisal or Broker Price Opinion (abbreviated BPO or BOV).
Lenders may accept short sale offers or requests for short sales even if a Notice of Default has not been issued or recorded with the locality where the property is located. Given the unprecedented and overwhelming number of losses that mortgage lenders have suffered from the 2009 foreclosure crisis, they are now more willing to accept short sales than ever before. This presents an opportunity for "under-water" borrowers who owe more on their mortgage than their property is worth and are having trouble selling to avoid foreclosure as a result.
Short pay transactions or "short sales" are transactions where the seller owes more on his or her home than the home is worth. The distinct nature of these listings enable a third-party lender to intervene in the terms of sale and ask a listing broker to reduce the gross commission offered on the property.
A short sale transaction may have significant tax, credit, personal liability, and other consequences for a homeowner yet might be the best option for a seller. As your listing or selling agent, we encourage you to seek upfront the advice of an attorney, accountant, or other professional regarding those consequences. Before we take any listing, we always carefully assess whether the seller has come to terms with the possible consequences of a short sale.
Submit a Complete Short Sale Package: Our proficiency in putting together a short sale package may improve the likelihood that the short sale will not only get approved, but get approved quickly. Documentation for a typical short sale package includes, but is not limited to, a hardship letter, financial statements, paycheck stubs, income tax returns, sales comparables, property condition including repair estimates and pictures, estimated HUD-1 Settlement Statement, listing and sales agreements, and C.A.R.’s standard form Authorization to Release and Convey Information (ARC).
We Take a Proactive Approach: Good short sale agents often attribute their success to their own tenacity, perseverance, and resourcefulness. Start the short sale approval process as soon as you can. Monitor its progress frequently. Ask questions. Carefully document your conversations with the short sale lender and others. If you proactively work with the bank a short sale can be a good option for many sellers in today's market. Please contact one of our specialists to help answer any questions you may have.
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Pacific Union Branch Brokerage Office San Diego, 325 7th Ave Unit 908, San Diego, CA. 92101 (619) 630-7138
Broker of Record: Hunter & Maddox International Inc. P.O. Box 16986, San Diego, CA. 92176