Short Sales for Dummies
How to Qualify
How do I qualify for a short sale? A question that the customer service reps of that 1-800 number dance around trying to satisfy their own quality protocol while still answering questions in a friendly manner and NOT releasing information that will factor into a loss for the bank or the investor (we will go over WHO the investor is later.) They will tell you; you do not qualify as you are current on your mortgage, so you fall behind and instead of getting a short sale your home rots on the market due to shitty property values and a low demand. In the meanwhile (depending on what state you live in) your home falls into foreclosure.. great. Thank you Bank of USA (yea you know who I am talking about)
Well here are the simple answers on how to accurately process a short sale in a short amount of time given you have a willing buyer, all without you falling into foreclosure.
1) You MUST be 30 days behind to qualify for a Short Sale, do NOT fall more than 30 – 60 days behind or you are eligible for foreclosure after only 90 days of default in most states! 2) You MUST provide a heart tearing Heart ship letter as to why you NEED this short sale. (Reasons such as: Death, Severe Illness, Overextension of Credit, Divorce, Loss of Income and Retirement) 3) You MAY NOT show any kind of savings or liquid funds!! Anything you used to get you qualified when you originated your mortgage must be moved or the bank WILL find your assets and deny your Short Sale. 4) Hire a well experienced Realtor who focuses on Short Sales, the Bank pays the commission and I HIGHLY RECOMMEND someone who has done this more than once or twice! 5) Market your property as hard as you can to get offers as most banks will not start a short sale without a valid offer from a potential buyer. 6) Realtor is to contact Bank along with hard ship letter, purchase contract, property photos (NOT from google, again get a good Realtor) and Listing Agreement. ALL MUST BE SIGNED AND DATED!!!!!!
To make things a little easier I have included some examples of Hardship Letters and additional Notes however I do recommend you read over the example that fits your situation best and write your own letter making it as personal as possible, don’t be afraid to hold back! Please read all notes with the individual letters to assure you don’t get labeled as a strategic short sale, or non-qualifying.
Default due to Loss of Income and Over-Extension of Credit
Dear Bank name here,
I am writing you in regards to the property located at Property Address Here secured by loan number: Loan number here as I can no longer afford the monthly mortgage payments due to loss of employment. I have tried my best to keep up with my payments however we have maxed out all lines of credits and our savings account in attempt to pay simple living expenses such as the electric and grocery bill. Please understand that this is our last option before foreclosure as the property is worth much less then when it was purchased. Please feel free to contact me at: your number here as we have a very interested buyer should you allow us to move forward with this Short Sale. Thank you.
Signature & Date
In order for this to work the party who has lost employment must have been used to finance the house in the origination papers of your mortgage. For example if you purchased a home in your name but your spouse lost her or his job you wouldn’t qualify as your spouses’ income was not associated with YOUR original obligation.
Death of Original Owner
Dear Bank Name Here,
I am writing you as Deceased name here has passed on and left me with the obligations of the property located at: 123 USA Street, secured by Loan number 555555455. I have attached a death certificate as well as documents showing that I am the power of estate, I hope you understand that have no desire to poses the above...
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