What is a Short Sale?
The basic answer to what is a short sale is a short sale is a property that sells for less than the balance which is owed on the mortgage. A short sale can be an upside down home, an apartment building or even vacant land. If there is a mortgage balance that is greater than the true market value of the home, that property is a short sale.
Not Every Home Qualifies!
Not every property qualifies as a potential short sale in a bank's eyes. The bank must agree to any short sales. Banks are under no obligation to approve a short sale. Banks will grant a short sale if the bank feels it is in the bank's best interest to approve the short sale.
If the bank is set to make more money via a short sale than if there were to be a foreclosure then the bank is more likely to approve a short sale.
What does it take to make s short sale?
An upside down home (meaning there is more owed on the loan than the home’s value)
A bank willing to negotiate a short sale
A seller with in a hardship situation
A buyer willing to purchase the home
What Role Do I as your Realtor Play in the Short Sale Process? ®
Some real estate agents throw homes on the market that will never close as a short sale. That's because the agents do not always qualify the short sale sellers. Some agents place unrealistic price tags on the short sale, which the bank will never accept. It is wise to choose an experienced short sale agent who has closed at least 100 short sales. Here is what an agent does in a short sale:
Determines the type of short sale. There are many types of short sales, from Fannie Mae HAFAs to regular, non-GSE HAFAs to a traditional short sale, and a few more in between.
Gathers the required paperwork and submits the short sale package to the bank. Sometimes agents outsource this part of the process or they might hire a third-party to negotiate the short sale.
Helps the seller to price the short sale home. The price needs to be attractive enough to entice a buyer to wait for short sale approval but high enough to satisfy the bank's BPO.
Puts the home on the market. This doesn’t just mean that I put it in the multi-list service and be done with it. Not at all. Your Short sale will be marketed exactly as I would any of my other listings. You will get brochures, a unique website, postings craigslist, postlets, facebook, the Denver Metrolist service and Realtor.com. This is just a small sample of how I will market your home. As your agent, I must submit all offers received to the seller. Some offers will be lowball offers because buyers don't know any better.
Negotiates the short sale. Sometimes sellers will hire a lawyer to do the short sale, but often it's the agent who negotiates with the bank on behalf of the seller.
Submits the short sale approval letter to the seller. Most sellers want a release of liability and no deficiency to do a short sale. State laws tend to govern the terms in the approval letters.
Sellers should always get legal and tax advice before participating in a short sale. I am not an attorney and cannot give legal advice. I CAN give you expert advice on the short sale process and how we can STOP foreclosure! Don’t be PASSIVE!! Take ACTION and let me help you!
Pick up the phone 303-898-9000 call or text! You can also email me at steve@stevejacobson.com .