Most common mistakes on short sale packages that may cause delays, or worse, rejection

Most common mistakes on short sale packages that may cause delays, or worse, rejection

Wells Fargo/Wachovia sent a letter to short sale agents about the most often seen mistakes that seem to hold up the approvals. It’s a good reminder to review the short sale package  before sending it.

Here are the most often found mistakes on submitted short sale packages:

1. Can’t read the contract and other paperwork. Be sure all pages sent are legible
2. Page 1 of purchase contract missing APN (Assessor Parcel Number) and/or zip code or property
3. All other pages of contract missing full property address at top including zip code
4. All other pages of contract missing DATE of contract
5. Contract missing DATE next to ALL signatures where date is required
6. Signatures of buyers and sellers missing PRINTED NAMES under them (not Owner of Record)
7. Names of seller do not match what is on the bank’s deed of trust. (Example, buyer was unmarried when she bought property, and switched to married name when signing documents)
8. If buyer is a Corporation or LLC, signature must be of the person given the authorization to sign, and the printed name under the signature must include the company name, printed name of the person signing, the person’s position with the company. This is a new requirement. This must also have full Articles of Incorporation AND operating agreement showing names and percentage ownership of all members
9. Listing and selling agents must fill in all appropriate DRE (Department of Real Estate) numbers, and must date the contract
10. Short sale addendum missing date of contract at the top, and the name of the Seller.  Be sure dates are filled in and printed names are under signatures.
11. Banks don’t need other advisories, but if agents send them, be sure they are complete: printed names, signatures, dates, property address.
12. HUD must have all sellers and buyers names spelled correctly on the first page.
13. HUD must have settlement date anticipated. Include address of settlement.
14. Listing agreement not complete with full address, missing sellers’ signatures and dates of contract
15. Hardship letter is outdated. Must be dated within 90 days at approval time
16. Submission form must come with the file as cover sheet. Must include on cover sheet any incentives requested and on the HUD statement to be considered

Many short sale agents may have experienced delays when the bank’s set up specialist reviews the documents with a fine-toothed comb. Best that we spend time checking and double-checking the package.  We know that if we miss any one thing, it gets bounced back to us. And then the bank gives us only 72 hours to make the corrections.

Remember, it takes less time to do it right the first time than to do it over.

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