What they say is true. Short sales are a long, arduous, and oftentimes frustrating process. Short sales for Palm Springs real estate are no different. To lessen the frustration, it is imperative to get the right players on your team from the beginning. Facing a financial crisis is hard enough, getting the right people on board can make your resolution a lot better.
Where to Begin
First, find an experienced short sale agent. No two short sales are exactly alike, but even so, novices need not apply. These deals can be extremely difficult, and you want a seasoned pro in your corner. Also, a more experienced short sale agent is going to have better contacts with the bank’s asset managers and loss mitigators, which will come in handy as the pressure starts to heat up.
Use the internet to search for short sales in your area. See if you can determine an agent or two who is or has done several of them and check for testimonials. I have over 5 years of experience with short sales and many testimonials of successful transactions. Another avenue to pursue in searching for the right agent is to ask friends and family if they know of anybody.
Also, you may want to contact a Palm Springs real estate attorney who has experience with the short sale process. Putting together a short sale transaction can be lengthy and confusing with potential legal ramifications. Having someone qualified to give you legal advice and protect your rights as a homeowner is a good idea, because a REALTOR® cannot. Typically, real estate agents and attorneys work together to ensure a good outcome.
If a short sale is not handled correctly, it will turn into a foreclosure. To avoid that as well as several headaches and hassles, get the best team possible working on your behalf right from the start.
Get Your Short Sale Documentation In Order
The next step, after finding quality representation, is assembling everything you will need to submit your short sale packet to your lender. Once you find your documents, your agent can help assemble everything.
- Hardship Letter (Some banks have forms to fill out, others require a personal handwritten letter. This is your explanation of why you are requesting a short sale.)
- Third Party Authorization Form (Required for a third party (agent) to negotiate on your behalf.)
- 2 Months of Bank Statements
- Last 2 Paystubs
- Last 2 W-2s
- Last 2 Income Tax Returns
- Signed Listing Agreement
- Income vs. Expenses Documentation (Depending on the lender.)
- Recent Mortgage Statements
- HUD-1 Closing Statement For New Offer
- Buyer’s Offer
- All Marketing Documentation
In the case that there is more than one lien against the property (home equity loan, second mortgage, etc.) your agent will need to repeat the packet assembly process for each lien holder. Once an offer is submitted on the property, your packet, as well as the qualified offer you have negotiated, will be submitted to each lien holder for their approval. As an aside, lenders are not typically willing to accept lowball offers, so keep that in mind as you negotiate any offers.
Be patient, the average time necessary to close a short sale is in the 3 to 6 month range, but some take even longer. If you are trying to short sale a home in Palm Springs, the process may be long and hard, but with competent parties on your side, things will run as smoothly as possible. Ultimately, a little extra preparation upfront, (get those docs to your List Agent!), can save lots of headaches later. Do your homework and get yourself the The Short Sale Queen of the Palm Springs Valley!