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Short Sale

Short Sale Information

What is a short sale?

A short sale is what happens when a home owner sells their property for less than the balance owed to their lender. A short sale is nothing more than negotiating settlement with liens holders to accept a payoff that is less than what they are actually owed. A short sale is also a method in preventing foreclosure. Often times a bank will approve a short sale when it believes the short sale will result in a smaller financial loss than foreclosing on the property. For the homeowner, the advantages to participating in a short sale is to avoid a foreclosure record on their credit report, possibly negotiate a deficiency settlement, and avoid future implications of having a derogatory public record.

Meet with a Short Sale Realtor to list your property. Your short sale Realtor will list your property in accordance with the standard Harcourts Listing process.

Short Sale Process Timeline
What is a short sale?

A short sale is what happens when a home owner sells their property for less than the balance owed to their lender. A short sale is nothing more than negotiating a settlement with liens holders to accept a payoff that is less than what they are actually owed. A short sale is also a method in preventing foreclosure. Often times a bank will approve a short sale when it believes the short sale will result in a smaller financial loss than foreclosing on the property. For the homeowner, the advantages to participating in a short sale is to avoid a foreclosure record on their credit report, possibly negotiate a deficiency settlement, and avoid future implications of having a derogatory public record.

Once your short sale Realtor receives, negotiates, and has you accept a buyer’s short sale offer the process often flows as follows:

Days 1-5:

  • Short sale packet is sent to lender
  • Lender intake processing team reviews file and all documents for completeness
  • Property Valuation (BPO) ordered by lender
  • Lender assigns file to a short sale negotiator

Days 6-10:

  • Short sale negotiator completes initial review of the file and often requests additional documentation

Days 11-25

  • Property valuation (BPO) is performed according to investor guidelines
  • BPO is sent back to the lender for internal review

Days 26-35

  • File is sent to investor & mortgage insurer for approval
  • Additional liens and loans negotiated by Realtor

Days 36-45

  • Lender determines the terms and conditions under which your short sale will be approved

Days 46-90

  • The approval letter is sent to your short sale Realtor
  • Your short sale Realtor will deliver notice of approval to the buyer’s agent
  • The traditional escrow starts here: Buyer financing process begins, inspections take place, and the buyer’s appraisal is ordered

Days 91-120

  • Close of Escrow

This is a general timeline. Every short sale situation is unique and it is very common that unforeseen circumstances delay the steps in the short sale process.

Completing a successful short sale requires much time and effort by not only the short sale Realtor, but also the seller. An effective short sale requires seller participation. Banks repeatedly ask for updated financials, letters of explanation for numerous items regarding the seller’s financial situation, and sometimes require a cash contribution from the seller and/or the buyer.

We will...

1. Settle on the requirements of your lender to approve your short sale and ease the submission of all the needed documents.

2. Figure out the listing prices for your home

3. Effectively communicate with you along the way to ensure that you will have the best short sale.