All Short Sales Are Not Alike

 

The  real estate market is finally on an uptrend and buyers are enthusiastically back in the game. Many homeowners, though,  have mortgages that are still higher than the current value of the  home.  For those "underwater" homeowners who need to sell,  the short sale process is an option, but should be approached carefully.

 

If the mortgage is an FHA loan,  the  U.S. Dept. of Housing and Urban Development(HUD) requires a specific process be followed in order to be considered for a short sale.  The homeowner MUST be the one to  initiate the request.  The lender will then begin the process of "approval to proceed" with a short sale and this takes approximately 30-90 days.  During this period, the homeowner's situation is reviewed for other home retention options.

 

With FHA loans, you do not have to have an offer or a listing agreement to begin the process.  If  you are unsure if  you have an FHA loan,  simply call the customer service number on your most recent statement and they should be able to give you the information.  If you have decided to sell, let them know that you would like to begin the process of being accepted for a short sale.

 

The lender will then give you instructions on how to proceed.  In all short sale scenarios, a hardship letter will be required along with proof of income, recent bank statements and a list of expenses and other documentation that the lender will request.

 

It is important to work with a real estate agent who understands the short sale process and has successfully navigated sellers through the process of getting short sale approval.  Short sale approvals are NOT automatic and are sometimes denied.   The right Realtor can greatly increase your chances of getting your short sale approved.   In addition, the right Realtor can make all the difference in how much stress and time is involved on your part during this tedious process.

 

Nancy Puder is a Short Sale Expert and the broker and owner of Signature Properties, a prestigious real estate sales and management firm in Arroyo Grande, CA.  You may contact her at Nancy@NancyPuder.com or (805)710-2415.
Your calls are always welcome!