When Should You Ask The Lender to "Waive the Deficiency"?

Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

tutas towne realty
Hi folks. Recently I was asked by a short sale agent when should they request a “Waiver of Deficiency” for their Seller. My response was to ask at time of submission and then in all lender correspondence thereafter.

An easy way to ask is to use a Short Sale Submission Letter. Below is the format I use. Use this Short Sale Submission letter to outline the terms of the deal and provide any info you want the Lender to consider. I want this letter to be the first thing the lender sees. If you are faxing or emailing your short sale submission package just use this as the first page.

If you are submitting through the Equator system then just add this letter to the front of your contract. That way the lender will be sure to see it.

Here’s mine. I hope it helps.



628 Grand Canal Dr Poinciana, FL 34759

PH:407-873-2747 FX: 407-358-5472


Email: BrokerBryant@gmail.com


3 November 2011


LN# xxxxxxxxxxx  


250 Anywhere Dr FL 33880

Borrower: Mr and Mrs Help Me Please


To who it may concern,

Please find following a complete short sale request with supporting documentation. The borrowers are not able to make payments and have no way of keeping the property. Therefore, we humbly request that this transaction is expedited so we can move towards closing and get this file closed and off the books prior to the new year.

Attached are the following documents:

  • Letter of Authorization

  • Listing Agreement

  • MLS Sheet

  • Listing History

  • Showing History

  • Market Analysis

  • Sales/Purchase Contract

  • Buyer’s Proof of Funds

  • Preliminary HUD 1

  • Financial Form

  • Hardship Letter

  • 30 Days Pay Stubs

  • Last 2 Months Bank Statements

  • 2010 Tax Return

  • 2009 Tax Return

  • 4506-T

  • Dodd Frank

My comments:

Mr and Mrs Help Me Please hired my company in October 2011 to assist with their short sale. The property was placed in the MLS and fully marketed on over 500 websites including Realtor.com, Zillow.com, Trulia.com and Homes.com

The property is currently vacant, however, it is being maintained by the borrower. Property values in this area are continuing to decline. The agreed contract price of $140,000.00 is spot on with current market values. Please see the attached Market Analysis.

The buyer is paying cash and can close quickly. We can close this transaction in November if you can give a quick  approval. 

So…on behalf of the Mr and Mrs Help Me Please, I humbly request that Wells Fargo accept this short sale request and relieve them of any future liability.

We are requesting a full Waiver of Deficiency and that this sale be reported to the credit agencies as “Full Satisfaction of Debt”.

Please feel free to contact me with any questions or additional information that you may need.  Thank you in advance for you attention to this matter.


Bryant Tutas


Bryant Tutas


Tutas Towne Realty, Inc




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***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

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 Tutas Towne Realty, Inc handles Florida real estate sales, Florida short sales, Florida strategic short sales, Florida pre-foreclosure sales, Florida foreclosures in Kissimmee Florida Short Sales, Davenport Florida Short Sales, Haines City Florida Short Sales, Poinciana Florida Short Sales, Solivita Florida Short Sales,  Orlando Florida Short Sales, Celebration Florida Short Sales, Windermere Florida Short Sales. Serving all of Polk, Osceola and Orange Counties Florida. Florida Short Sale Broker. Short Sale Florida.

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Re-Blogged 2 times:

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Ed Silva
RE/MAX Professionals, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

BB, a couple of subtle hints that I need to incorporate into my next short sale cover letter. I've been holding out the request until an offer was presented.

Jan 29, 2012 03:20 AM #33
Brian Hayes
Horizon Investment and Management - Bountiful, UT

Yes, I forgot to ask you about that too. I don't know what that is. I know that in all of transactions the banks have been asking for an "Arms Length Disclosure" and a "No Flipping Affidavit" but  they generate those through their system and send them to me pre-printed, so I can't provide those in advance. I would like to know what Frank Dodd document you provide. Thanks.

Jan 29, 2012 03:24 AM #34
Woody Edwards
First Choice Realty, Inc - Chesterfield, VA
A Realtor® Who Answers His Phone!

Thanks a bunch!  Creative writing was not one of my majors in school.....in fact, I ran from the English dept toward the math and science.  Not numbers, way different story! 

Thanks for the great letter. I have tried something similar several times and ended up playing hoops with File 13!

Jan 29, 2012 03:34 AM #35
Goran Utvic
606 Homes LLC | Chicagoland Brokers Inc, Chicago IL 60656 - Chicago, IL
We Buy & Sell Chicago Houses Fast

Bryant this is a great letter and excellent tip...thanks. Getting the deficiency waiver is key to a successful short sale

Jan 29, 2012 04:22 AM #36
Dagny Eason
Dagny's Real Estate - Wilton, CT
Fairfield County CT, CDPE Homes For Sale and Condo

That is such an excellent letter, Bryant!     Thanks for the suggestions on saying everything up front like that!    Love it!!!!

Jan 29, 2012 05:23 AM #37
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

Concise, compelling and a direct call to action. Great post and submission letter.

Jan 29, 2012 05:27 AM #38
Eric Michael
Remerica Integrity, Realtors®, Northville, MI - Livonia, MI
Metro Detroit Real Estate Professional 734.564.1519

You mean we can't just ask for this somewhere before closing? lol I wonder how many homeowners lost this option because their agent didn't start the process with this request?

Jan 29, 2012 05:39 AM #39
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

The Dodd Frank is a certification form. Required with HAFA. I get it signed at time of listing and submit it with all of my short sales.

Here it is:



Jan 29, 2012 05:40 AM #40
Melissa Brown
Helen Adams Realty - Charlotte, NC
Realtor - South Charlotte NC Homes for Sale

Bryant - thanks for sharing.  I love how clear and concise this letter is.  I wish the banks were as clear and concise!  Thanks!

Jan 29, 2012 05:44 AM #41
Cynthia Larsen
Cotati, CA
Independent Broker In Sonoma County, CA

Clear, concise and powerful. And when they ask you to fax in the package 6 times, they'll have 6 copies of it!

Jan 29, 2012 06:02 AM #42
John DL Arendsen
Crest Backyard Homes "ADU" dealer & Contractor

Great information. Thanks!

Jan 29, 2012 06:04 AM #43
Ric Mills
Keller Williams Southern Az - Tucson, AZ
Integrity, Honesty, and Vast Real Estate Knowledge

Great Post and our Team uses a similar letter to the lender(s) to help.  Last year we only had one SS fail and that was because Chase Bank (second) made an illegal and un-warrant change at the 11th hour and caused the sale to fail.  If the Banks  want SS to go through they will succeed.  They have gotten better with a few exceptions like Flagstar Bank.  The SS process will be with us for a while and one can only hope the lenders get better at making them work.

Jan 29, 2012 08:33 AM #44
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

Thank you Broker Bryant.  I will have to copy it for shameless plagerism. 

Jan 29, 2012 01:03 PM #45
Paddy Deighan JD PhD
TimeshareLawyers.pro - Vail, CO
Paddy Deighan J.D. Ph.D

great blog post....it is astounding how many negotiators fail to ask for the waiver. At the very least, I get an email that states they will not seek deficiency if they short sale affidavity and arm's length agreement are complied with

Jan 29, 2012 04:37 PM #46
Sylvie Stuart
Realty One Group Mountain Desert 928-600-2765 - Flagstaff, AZ
Home Buying, Home Selling and Investment - Flagsta
This is awesome! Thank you so much for sharing this, it is going to be very useful!
Jan 30, 2012 12:02 AM #47
Sean Williams
AcklesWilliams of Semonin Realtors - Louisville, KY
Your Louisville Realtor

How often will the lender accept this waiver? I know it is lender specific but do you find that you have a high success rate with this?

Jan 30, 2012 01:31 AM #48
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Direct & to the point. Hope someone at the bank can read.

Jan 30, 2012 07:33 AM #49
Bob Miller
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team

Hi Bryant, good suggestions and thanks for sharing your letter, but I am finding more banks (especially 2nds) refusing to waive deficiency.

Jan 31, 2012 10:15 PM #50
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Sean. Lenders are very receptive to issuing a waiver. However sometimes the seller has to buy the waiver by making a cash contribution. Especialy when there is no financial hardship.

Feb 01, 2012 06:35 AM #51
Eric Poortinga
FLEX Real Estate - Round Rock, TX
Round Rock, TX ~ buyernulls agent w/ rebate options

Thanks Byrant.  Just learning the ropes of short sales myself, so very informative.  

Feb 15, 2012 01:50 AM #52
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