How to Convince your Lender Agree to a Short Sale
In any real estate transaction, the buyer sets the ultimate price of the deal. When a seller lists their home at a price that is too high, no offers are forthcoming. When they set the price too low, it attracts buyers and the final contract is frequently done at a price that is more than the initial listed price.
The best way to start is to find what other similar homes have sold for in the neighborhood. Make up a list of sold homes, with their address, sales amount and any unique characteristics to submit with the contract and you other application information.
An alternative to that is to hire an appraiser to conduct an appraisal that is similar to what they would provide to the bank. Depending on the area of the country where this is performed, the appraisal should cost a few hundred dollars. Another method is to look through tax records to find what transactions have been recorded. Many localities have this information on-line – check with your local government to see how to access these records.
Because the mortgage lender is taking a loss when they approve a short sale, they want to know that the seller cannot make up the difference. That involves a complete set of financial documents, showing the sellers income and other assets.
If there has been any other person who signed the mortgage note, such as a parent who co-signed, they also asked to provide information showing their financial condition. Generally, separate information for husband and wife are required.
If you do not have a financial hardship, the mortgage lender will frequently not agree to the short sale, or will ask for some contribution to the transaction, to limit the lenders loss.
Keep in mind that the lender is making a cost/benefit decision and is looking to minimize their loss. The cost of foreclosing is significant, but is a process that the lender can pursue. The lender will not normally discuss this with the seller.
Finally, dealing with the mortgage lender is frequently a frustrating experience. Their volume of these transactions is high and they are hard to contact. Some require they be contacted only by email or fax. Many of the lenders’ staffs have heavy workloads.
A new field of niche professionals has grown up over the last couple of years, called “Negotiators”. They generally charge a fee up front and are frequently associated with settlement companies or law firms that specialize in real estate. They work with the lender and it can be worthwhile to talk to one or two of them to see if they can add value to your transaction.
Short Sale Homes That Fits the Buyer’s Needs:
Miami Beach, Miami-Dade County
Port Saint Lucie, Saint Lucie County
Boynton Beach, Palm Beach County
Deerfield Beach, Broward County
Find more Miami Beach Foreclosures
