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My Experience with Short Sales & Summary or Required Documentation
 
I am currently invovled with several properties that are considered short sale properties.  Because the debt on the house is higher than the market value and the owners are having trouble making their payments the lenders might consider taking less than what is owed on the property.  Sometimes the bank will wait for the property to go to foreclosure if low offers are coming in during the short sale listing period.
These short sales can be complicated and take a lot of time preparing documentation and communicating with the banks involved.  Each bank has its own set of documents it requires but for generality purposies here is a list that might be asked of a seller and buyer:
Seller:                                                                                    Buyer:
Fully executed purchase contract                                            Purchase Contract
A Hardship/ explanation letter                                               Pre-Approval Letter
2 years w-2's
last 2 months bank statements
last 2 paystubs
Tally of closings costs and settlement statement
Listing agreement
Broker Price Opinion or Comparative Market Analysis
 
Ususally a full package is required prior to sumission or the waiting period will likely be extended.  Part of my job is to see that all these documents are complete and the lines of communication with the banks are open and clear.
Sometimes properties have more than one loan which can comlicate the process by ... more

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