Submit the short sale to the bank. Now what?

So you have followed my the steps in my previous post Selling? Thinking a short sale is an option, here's what you need to know and now your COMPLETE package has been submitted to the bank.  Now what?

Typically after the first meeting of a client I have them sign an authorization allowing me to communicate with the bank on their behalf.  This is a requirement as the banks will not talk to an agent about someone's account without a signed authorization.  Most likely I have been in communication with the bank making sure that I have all the correct phone numbers and that the package and authorization has been sent to the correct departments.

Banks are just as dysfunctional as our government.  If a home is in the foreclosure process (3 missed payments and legal proceedings have started), I communicate with both the bank's attorney to let them know we are processing the short sale and I give them my contact information along with the seller's attorney.  The different departments of the bank do not always communicate with each other so I make sure to let everyone know whats going on. 

DISCLAIMER: In IL properties typically take 1 year to go through the whole foreclosure process, we also have round table closings in which lawyers represent both the buyer and seller.  This is different in every state.

I typically call the bank twice a week to check on the file.  Often they will loose documents in the process and most of the time some documents need to be updated.  Depending on the bank the actual order of steps may very but the process is typically the same.  After all the documents are received the file is typically assigned to a negotiator.  This is a milestone as the process takes from 30-60 days for this to happen.  Once this happens there is an actual person to talk with that is able to let me know exactly whats going on.  In addition a broker pricing opinion (BPO) is order by the bank.  A BPO is a mini appraisal completed by a real estate agent.  The BPO is one of the most important parts of the process that can often create big problems.  I will write more about this in another post. 

During this time the negotiator is making sure the file is complete (all the paperwork is update) and that the BPO valuation is inline with the sales price.  The negotiator is looking through all the selling fees required to close the transaction and finding out the final amount the bank needs to net.  The negotiator will then contact all the parties and let them know if the short sale has been approved or declined.  If the file is declined then typically the bank is asking for more money or is refusing to pay for some fees.  We can

Assuming that the negotiator approves the short sale they will issue a packet letting everyone know what the amount the bank must receive and when the property must close by.  If this closing does not take place by the approved date the buyer may have to pay a penalty for every day the closing is delayed. 

The process of a short sale is not very difficult but it does require precession and patience to complete.  If you have any other questions about a short sale, please do not hesitate to contact me.

Thanks,

John Ziemba
Realtor
Keller Williams Team Realty
847-217-0480
Realtor@JohnZiemba.com
www.JohnZiemba.com