Short Sale, Colorado Springs!
I am frequenly asked by home owners who are experiencing financial troubles to explain what aShort Sale is and how it works! Here in Colorado Springs our housing market has lots of Short Sale properties as well as bank and goverment owned homes for sale on the market.
Basically, a home owner who is having troubles making payments--does not have to be late or may already be late withpayments or knows they are coming up on a future circumstance that will not allow them to make payments are candidates for a Short Sale. The phrase Short Sale derives from the shortage of money the bank will receive between what the home sells for and what the home owners still owes on the home. Each circumstance is reviewed individually by the banks before a Short Sale is granted by the bank to the seller.
Here are some basics of a Short Sale and its pprocess and some of the steps may be out of order and not all are included: Please call for details or a FREE CONSULTANTION-719.209.0190
Home Owner consults with a real estate professional ( Short Sale & Forclosure Specialist Designation), attorney and tax consultant and if determined, home is listed with the agent and placed into the MLS.
Home Owner contacts bank and request a Short Sale Packet from any mortgage lender the home is currently financed with. Takes about 5-7 business days to receive the paperwork. Lots of financial information will be asked for and requested by the bank as well as a Hardship Letter. After packet is filled out and completed the packet is giving to the Agent so they can properly label, tag and number each page of the packet. Once the packet is sent to the right fax number of the banks it takes about a week to get the packet assigned by a Short Sale Negotiator.
Home is priced at market prices to start with for approx. 60-90 days before any major price reductions. Bank wants to see that there was an effort to market the home at market rates before they are willing to take a reduction in price from a buyer.
Bank will order an appraisal and or a BPO (Broker Price Option) to get and idea of what they are working with concerning the condition of the home and market prices in the area.
Prices are dropped more frequently after the 60-90 day period to incite home buyers to make and offer. The list price may not be the price the bank counters back with. Extreme low ball offers are usually frowned upon by the bank. However, there are many different tactics and reasons why an agent will price a home at a given prices, so ask questions before you judge an agent.
Offer comes in on the home and the home owners either accepts the offer or declines. If accepted, the agent sends the offer to the bank, along with the listing agreement, recent financial information from the home owner, HUD statement from a title company.
Offer and documents are submitted to the bank and bank determines what they will take as a payoff for the home. The price may be the buyers offering price or the bank may decide the home is worth more and they could as for more.
Once a price is aggreed upon, the bank with stipulate when they would like the closing to take place and then the agents work on making that closing happen.
Thank you for reading the BASICS of a Short Sale
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