AFTER SPEAKING TO A POTENTIAL SHORT SALE SELLER . . . I usually follow up with a letter that I found helps reiterate our conversation to make sure that we are all on the same page and have the same goal in mind. Also, to make sure in writing I state that they should contact a tax professional regarding the 1099 issue. This letter helps because then the seller, if serious about pursuing the short sale then, he will have a list of documents I will need to review and prepare to be one step further. This isn't used for all of my clients, but the basic content is here and it is very helpful in preparing for a short sale. I hope you find it helpful also.
SHORT SALE LETTER TEMPLATE
I am glad you called me earlier because maybe we can resolve this issue together. I am a licensed real estate agent for __________. After I looked up your property on the MLS I find that your property may be a candidate for a short sale.
I will need the following information from you before I can make a decision on whether or not your short sale will be considered by your mortgage company:
•1. I need a letter from you "HARDSHIP LETTER" stating what has changed since the purchase of your house that has left you unable to pay the mortgage.
•2. Tax Returns for last two years
•3. Last 4 paycheck stubs (or if self employed) last 2 bank statements from your company.
•4. Last 3 Bank statements for you personally.
•5. Settlement package from purchase of home (to review your situation when you purchased).
•6. Last mortgage statement ( date) for all mortgages on property.
•7. Form - (I have) authorizing me to speak to your lender. (Third Party Authorization)
After you have gathered the above information, I can meet you at your convenience.
After our meeting . . .
•1. I will contact the bank to see if they are interested in working out the terms of the loan or a short-sale.
•2. I will list your home on the market (at market value). We will have a listing agreement that I will have you sign. (Bank will ask for a copy of the listing agreement) We can also list it byappointment only, no sign, etc. to keep it somewhat private if you wish, but we could get more potential buyers with signage and be more flexible with the showings.
•3. Forms - (Mortgage company will send you via facsimile through me, after I speak to them) asking for a financial analysis of your entire situation including all expenses, including bills you have and income to see if you qualify. They may require other things depending on the company. Each lender has their own rules.
•4. We will accept a contract.
•5. We will submit contract to the Bank for their approval.
•6. The Buyer must have a pre-approval letter from the mortgage lender he/she will be using, disclosing that he/she can afford to purchase this house and move forward in the purchase of the home and can close within 30 days of the contract.
•7. The Buyer will move forward in the purchase as we await for approval.
•8. Once the mortgage company gives us an approval will set new closing date.
•9. Move forward with closing w/title company.
•10. Shortage will be recorded with the bank and the bank may or may not come after you with a confessed judgment or form 1099 to you at the end of the year. This could cause great hardship to you in the future. You should discuss the form 1099 issue with a tax professional. There may be other steps depending on the company we are dealing with. But as we move along in the process, we will handle it.
Let me know if you want to proceed and we will set up an appointment to go over everything. You can reach me at ________.