|WHY BANKS WILL AGREE TO A SHORT SALE:• The mortgage is in arrears or foreclosure.
• An REO is a liability, NOT an asset.
• The property is in poor condition.
• The homeowner has hardships and cannot afford the payments.
• New homes in the area are being chosen over existing homes.
• The area or neighborhood has depreciated in value.
• The bank’s shareholders are concerned when there are too many defaulting loans on the books.
STEPS TO A SUCCESSFUL SHORT SALE:
1. Find a property owner in distress.
2. Put a deal together with the homeowner.
3. Have the homeowner sign a “Release of Authorization” form.
4. Fill out a sales contract for the amount your client wants to offer the bank and have the homeowner sign it.
5. Contact the Loss Mitigation department at the bank and prepare the following:
• Your cover letter explaining your client’s hardship.
• The sales contract. • Justifying comps in the area.
• Pictures of the subject property, if possible.
• A net sheet or closing statement.
• A signed hardship letter from the homeowner.