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What information is required from the home seller for a short sale?

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Real Estate Agent with Realty Group Referrals 16766

What information is required from the home seller for a short sale?

 

Home owners that owe more than the current value of their home may need to consider a short sale if they need to sell their home.  Short sale transactions require the approval of the secured mortgage lenders. 

When we take a short sale listing, we recommend the use of an attorney to actually handle the negotiations with the lenders.  We use Michael Hollman at Village Settlements in Kentlands.  Mike has successfully negotiated short sales for many years.  His services are part of our real estate listing package.   Mike will discuss the specific needs with the mortgage borrowers and work with them to establish a plan of action.  The short sale route is not the best for every family.  Some borrowers should file for bankruptcy before considering a short sale. 

This is the new client check list that covers the basic information that will be required by the secured mortgage lenders.

Authorization letter and engagement letter

Hardship letter

Financial Statement

Last two years of tax returns

Last two months of bank statements

Last 30 days of pay stubs

Listing agreement, including the MLS printout

Contract with the potential buyer

Most recent mortgage statements

Home sellers that are taking the short sale course of action must be willing to provide the necessary detailed documentation.  Patience is also needed because they may be required to provide the same information such as financial statements on several different forms.

Smart short sale purchasers will confirm that the needed seller documentation is in hand before contract ratification.  

 

Kentlands, Spring Flowers IMG_9174

Photograph by Roy Kelley using a Canon PowerShot G11 camera.

Roy and Dolores Kelley Photographs 

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Roy and Dolores Kelley Photographs

Roy Kelley and Associates

 

Roy Kelley, Associate Broker

Realty Group Referrals (Retired from RE/MAX Realty Group)

6 Montgomery Village Ave., Suite 200

Gaithersburg, MD 20879

Main Office:  301-258-7757 (You will not reach me at this number)

Send an email message if you need my phone numbers. I will be happy to recommend a real estate professional if you are moving to the area.

Comments (19)
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ba`B Ratliff
Robert Ratliff Realty - San Antonio, TX
"Sold with Bob"

Roy, great advice for homeowners having a hardship and knowing they have options in many cases.

Mar 27, 2013 05:09 AM
Matthew O'Hare
Osterville, MA

succint and to the point, this is an excellent post. I can't wait to look back to this time and think how funny that short sales were so prevalent in our dealings.

Mar 27, 2013 06:40 AM
Robert Bob Gilbert
Berkshire Hathaway HomeServices Anderson Properties - Katy, TX
Your Katy TX ( West of Houston) Real Estate Expert

Hi Roy,

Congrats on the feature and good article written by you advising all of us about Short Sales. Your Broker works with an Attorney to negotiate a short sale is very smart and helpful.

Mar 27, 2013 07:22 AM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Your positive feedback is always appreciated.

Good luck with your short sale transactions.  We find that many buyers are still trying to avoid short sales because of the uncertainty that is involved when nobody knows when the lenders will provide their required approvals.

 

Kentlands, Spring Flowers IMG_9172

Photograph by Roy Kelley using a Canon PowerShot G11 camera.

Roy and Dolores Kelley Photographs

Mar 27, 2013 07:47 AM
Hella Mitschke Rothwell
(831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

Roy: In California, at least in my neck of the woods, we, the Realtors(R), are in touch with the lenders on behalf of the seller. However, we do urge sellers to talk to an attorney before they make the decision to sell their home as a short sale. But it's a legal question of do or don't, not the process itself.

Mar 27, 2013 08:15 AM
Jennifer Fivelsdal
JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571 - Rhinebeck, NY
Mid Hudson Valley real estate connection

Roy excellent checklist for those needing to go the short sales route.  Patience is certainly a necessary quality.

Mar 27, 2013 01:32 PM
Christine McDaniel
Christine McDaniel Realty, LLC - Avon, IN
Broker Associate

Great post Roy!  This is great information for people who feel overwhelmed and wonder about their options.

Mar 27, 2013 02:24 PM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Roy - This is a good list of documentation to start though it seems like there is always more.

Mar 27, 2013 03:49 PM
Conrad Allen
Re/Max Professional Associates - Webster, MA
Webster, Ma, Realtor

Excellent information Roy.  Thank you.

Mar 27, 2013 08:47 PM
Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400
The Top Team @ Charles Rutenberg Realty 255 Executive Dr, Plainview NY 11803 - Plainview, NY
Long Island Condo and Home Specialists

Roy, We use Attorney's for all our closings so good advice especially for a short sale.

Mar 27, 2013 09:44 PM
Randy Hilman REALTOR® Associate Broker
Randy Hilman Homes - Moultonborough, NH
Guide & Mentor to Home Buyers & Sellers

Good morning Roy:  Good post and just what I've needed as one of my listings is going the route of a short sale and, of course, I've never done one.  I'm curious to know whether the attorney you bring into the loops helps negotiate particular offers, or simply the parameters of the short sale agreement between lender and client?  Please do tell more.

Mar 27, 2013 09:47 PM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

Hi Roy, Short Sales are a totally different sale and need an experienced agent that knows what the process is. Good information here Roy.

Mar 27, 2013 10:17 PM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Hella:  In Maryland, many agent do handle short sale negotiations.  We opt for the use of an attorney that gets a higher percentage of the transactions to settlement.  By the way, the same attorney handles the settlement.

Randy:  The attorney handles the negotiations.  He looks to the sellers and the agents to provide the needed documentation. The distressed home sellers are often more comfortable when they know that the attorney and their agent are working to make the transaction happen.

 

Kentlands, Spring Flowers IMG_9177

Photograph by Roy Kelley using a Canon PowerShot G11 camera.

Roy and Dolores Kelley Photographs

Mar 27, 2013 11:18 PM
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

The very nature of this sale requires a professional on point...The banks have the gold and sellers need to know how they will rule

Mar 27, 2013 11:46 PM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

I hope you are enjoying a most productive week. Enjoy the spring weather with your camera in hand. 

Mar 23, 2016 09:51 AM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Good Wednesday morning to all. I hope you are enjoying a most productive week.

Feb 08, 2017 06:52 AM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

I hope you enjoyed the holiday weekend. Have a great day and an outstanding week.

Feb 21, 2017 05:52 AM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

We have a beautiful Tuesday morning in Maryland. Chef Dolores has decided to defer her dinner plans and is heading to the golf course at Montgomery Country Club.

Feb 28, 2017 08:01 AM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Sometimes it is a good idea to revisit some old blogs and reblogs. We might even find some good ideas for new posts.

Apr 06, 2018 09:26 AM
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