WHAT IS A SHORT SALE?

A short sale occurs when a lender is willling to accept less than the amount owed when a property is sold.  A short sale is often used to avoid a foreclosure proceeding.  There are both advantages and disadvantages to a short sale and every homeowner's circumstances are different.  Therefore, it is wise to consult a real estate attorney prior to undertaking the short sale of a property. 

Whether or not a borrower will qualify for a short sale is a decision that is made by the lender on a case by case basis.  However, there are certain things that lenders typically look at when making their decisions.  First, how much is the property worth?  The lender will ascertain the value of your property by way of an appraisal or a brokers price opinion.  The lender will look at any offers to purcahse the property in light of the value the lender has assigned the property.  Secondly, the lender will look to the finances of the borrowers on the loan.  Borrowers will be required to show a financial hardship and prove their inability to realistically pay the mortgage payments. 

1. Hardship Letter
2. Income and Expenses ( Last 60 days)
3. Listing Agreement (3-6 months or more)
4. Listing History (Price, Activity, Etc.)
5. Last Two Years Tax Returns
6. Last Two Months Pay Stubs
7. Purchase and Sale Agreement
8. HUD-1 Settlement Statement (typically prepared by attorney or closing agent)

  For further information, please contact Attorney Christopher J. Horlacher, Esq.