When requesting to your lender to accept a short sale on your home, there are 3 categories of items that you will likely need to get put together. Financial information, hardship information and property information.
Lets start with what you will need on the financial list
Financial Information
- Three most recent bank statements for all checking and savings accounts for all borrowers
- W2s for the past 2 years for all borrowers
- Income tax returns from the past 2 years for all borrowers
- Past three paycheck stubs for all borrowers
- And copies of all bills within the past 2 months from all borrowers. These will be used to put together a financial worksheet. These could include; car loans, alimony/child support, child care bills, credit card bills, utility bills, phone and cell phone bills, cable, insurance, medical bills, food/groceries, gas, student loans etc.
Hardship Information
- Hardship letter that describes exactly why the homeowners were unable to make their payments. The homeowner must write the hardship letter.
- Documentation that proves the hardship, which could include hospital bills, medical bills, home repair bills, unemployment, incarceration, death certificate, divorce decree etc.
Property Information
- Information about any other liens on home if any. The homeowner might have this information, ask them if they have a recent credit report.
- A recent Comparative Market Analysis
- Estimated HUD-1
- Estimates for necessary repairs for the home
- Most recent property tax bill and proof of payment status
- Proof of homeowners insurance coverage
Lender Information
- Monthly statements from the first and second mortgage holder
- Name of supervisor in Loss Mitigation Department with direct phone number
- Short sale application from the mortgagor
- Written authorization from the homeowner for the Realtor to speak to the mortgage company on their behalf.
Other Important Stuff
- If the homeowner has filed for bankruptcy, you'll also need the name and number of the attorney and permission to speak to them
- And, if the homeowner is involved in a law suit, you will also need the name and number for the attorney and permission to speak to them
- You will also need lots of patience and understanding
Short sales take a long time to process but if you have all the information you need before you get started it really helps to shorten the processing time. Remember that homeowners did not get in this situation over night and it will take just as long or longer to help them through the process. You need patience and understanding to help deal with homeowners that are on an emotional roller coaster and quite often embarrassed about their financial situation.
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