The Short Sale Package, along with the Hardship Letter, is one of the most valuable components to getting a deal done quickly. Incomplete or poorly assembled short sale packages could add months to an already tedious process. Read straight through our tips to find out more about how to build a compelling, complete, and professional box that will fly straight through the loss mitigation division and get your deals done quickly!
Tip #1: explore the Lender! Each lender is different, so make sure you know what the lender needs in a short sale package. Many lenders have exact procedures that need to be followed and documents that need to be completed for your box to be thought about acceptable.
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For example, Citimortgage requires you to fill out their exact Financial Application - if you don't fill out this document you can hurt your chances for getting your box processed in a timely matter. Each lender is different, so make sure you do your research! Short Sale Artisan's education and Marketing section in the site which has lender-specific facts to help you out and is constantly updated with the newest information!
Tip #2: Make sure you contain all your valuable documents! There are many documents that are used in the short sale process. Remember, some of these may not be valuable in all circumstances! Make sure that you contain all that is required from the lender you are working with. Leaving something out just gives the loss mitigation division a fancy to put your box to the lowest of the stack, and time is valuable in the short sale process!
- Sales covenant or Deed
- Short Sale Offer Letter - this can be calculated and generated automatically with Offer Generators
- Borrower's financial statement- get at least 2 years worth of W-2 forms.
- Hud Statement Draft - this shows the bank the improbable hamlet amounts.
- The Hardship letter - There are some good articles out there on how to write a hardship letter - the most foremost thing is to keep it accurate, concise, and convincing.
- Paycheck stubs - if the borrower is not working that will need to be explained.
- Bank Statements - similar to paycheck stubs, accounts may have been closed. If they are, it will need to be explained.
- Credit Report - if it shows the borrower is having a difficult time meeting all their obligations, it will help make the case for a short sale.
- Listing Agreement - the bank will want to see that you have the house on the market. Some lenders will need that the asset be listed for a inescapable number of time before they entertain a short sale.
- Authorization to issue information - this document allows investors to work directly with the lenders on behalf of the borrowers
- Photos and fix Estimate - take pictures of the asset and evaluation fix costs. There are some good sites out there to help you fancy fix costs!
- Executed Bill of Sale - ready in our Document Generator - make sure you are very careful with disclosure when it comes to the bill of sale!
- Supporting Hardship facts - for example; medical statements if the hardship is illness related.
- Buyer Approval - if there is a cash buyer the bank may want proof-of-funds.
- Comparables - show properties in the area and what they are selling for or have sold for to help by comparison the offer. Short Sale Artisan makes this easy to originate with integrated Zillow comparables quest functionality
- Crime or Neighborhood Data - if the area has seen depressed home values because of circumstances like crime, contain that information.
- Limited Power of Attorney - more huge than the authorization to issue information. The Poa will allow you to negotiate on behalf of the borrower.
- Additional Documents - many lenders have exact documents, so do your explore and know what needs to be submitted!
Tip #3: Professionalism and appearance are important! Don't be sloppy with your short sale package!
Make sure your box is well formatted, professional, and easy to read. Remember, lenders are getting inundated with these packages in overstaffed departments. Having a well-assembled, complete, and logical box that is easy to read will make it that much easier to be processed quickly.
Additionally, keeping your box professional will help to convince the mitigator that you are serious about the offer. Either it is your first deal or your 500th, you will want to give the impression that you know what you are doing. A professional box demonstrates confidence.
Some general tips which shouldn't be overlooked:
- Spell check - you wouldn't believe how many investors will submit facts to a bank with mis-spelled words. Take the endeavor to make it right!
- Visual Consistency - be consistent in your documentation. This means make the pages look like they belong together. For documents that you originate or type, make sure to use similar fonts, margins, and headers and footers.
- Data Consistency - make sure there are no contradictions in your package. Your financial statements should tie to your W2's which should tie to your hardship letter. Any inconsistencies will quickly bring query to the package.
- Make it easy to read - loss mitigators are overwhelmed with these packages. Make them easy to read! Put a petite bit of extra space between lines to make it easy on the eyes. The habitancy on the receiving end will appreciate it!
- Ensure the box is complete - Make sure your box has everything the first time out. Submitting a half-complete or incomplete box will practically literally delay the box and frustrate the mitigators, and you want to keep them happy!
Tip #4: Submit your box and effect up! Once you submit the box to the bank (make sure you effect the procedures you identified in Tip #1!), follow-up to make sure they have the package.
The old saying, "The Squeaky Wheel gets the Oil" is true. It is a bit political; so make sure you balance out annoying the lender with getting them to continue to move send on processing. Also, make sure if they recognize anyone as missing from the box you turn around delivery of that as expediently as possible.
Good luck! Do you have any other tips to share? Add them to the comments!
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