What Is A Short Sale?

A home sale is classified as a "Short Sale" whenever it is sold for less than the amount owned on the mortgage and the mortgage lender accepts less than the full amount due on the outstanding balance.  The seller must meet several criteria in order to qualify for a short sale?  Some of those include:

• The seller must owe more on the home that its current value
• The seller must prove that the home cannot be sold for enough to satisfy the current outstanding mortgage(s) owed
• The seller must demonstrate that they are suffering from a financial hardship which leaves the mortgage payment no longer affordable

For sellers meeting the above criteria, submitting a short sale package to the lender is the next step.  The short sale package being submitted will need to include the following:

• Financial statement detailing all monthly expenses
• Two most recent pay stubs
• Last two years of W-2's and Federal Income Tax Returns (all schedules)
• Two most recent month of bank statements for every account
• Copy of property tax bill
• Copy of most recent mortgage statement for each loan
• Listing agreement
• Purchase agreement (if under contract)
• Estimated HUD-1
• Financial hardship letter explaining your circumstances

A Certified HAFA Short Sale Specialist will be able to assist you with your Short Sale request.

When contemplating a short sale or foreclosure, always consult legal and/or tax advice.