Why we are The SHORT SALE EXPERTS in Santa Clarita Valley and Beyond – Re/MAX of Valencia and The Paris911 Team.
Here is the Paris911 adopted Credo with regard to our Team handling your Short Sale property – I would suggest you review this list and see why we have been on top of the Short Sale market and can help you if this is your unfortunate circumstance.
Each member of our team takes the following steps and I wanted to share our written Short Sale Handling List so you can see we are not flying by the seat of our pants – but, there is a plan and method to our madness.
It is a big decision – to Short Sale your Home – so be safe, mindful and give it a lot of thought and preparation. If you also need some sound advise – give our team at call at 877-977-REMAX – 877-977-7362 and we will be happy to set up a confidential appointment at Re/MAX of Valencia to meet with you and yours.
SHORT SALES FROM A – Z
A = Always obtain a short sale addendum to your listing and Always obtain an Authorization to Receive and Convey Information. Make sure your Authorization contains two very important items: 1) All loan numbers involved 2) The Borrower’s social security number. (Be sure it is the borrower of record, if more than one borrower it would be safest to have all social security numbers)
B = Bankruptcy will stop your short sale or a foreclosure right in its track. If your seller has filed for bankruptcy find out if their attorney is willing to file the appropriate paperwork to release the property from the bankruptcy. If not, find out approximately when the bankruptcy will be discharged. You cannot close escrow until one of these two things happen.
C = Carefully explain to the seller that you will need them to cooperate with the bank fully. If they don’t want to contact the bank and find out what is required to complete the short sale make sure you do. Borrower’s need to provide all of their current financial information and a hardship letter in order to get the bank to review their qualifications for a short sale. Many banks will do this verbally over the phone. Make sure your client writes down the name of who they spoke with, the date they spoke with them and the time they spoke with them.
D = Don’t assume anything with the bank, always check to verify they received what you faxed or email to them. They receive a fax and scan it into their system. If you check with them and they haven’t scanned it into the system within 72 hours you should fax or email it again.
E = Everything you send MUST have the loan number at the top of the page. Always write the loan number on EVERY PAGE you send. That way if they lose a page they can figure out what file it belongs to.
F = Friendly conversation and a polite attitude go a long way with the bank. No matter how frustrated you are, the person on the other end has been dealing with situations like yours all day everyday for quite some time. They are human and need someone to care.
G = Good communication logs are a must in a short sale. Be sure you write down the date and time of every conversation you have with the bank, seller, buyer or other agent involved. Always get a name and if possible get an employee number when talking to the bank or asset coordinator. When you call in again they will be more cooperative if you can tell them you spoke with John on February 13, 2009 @ 10:09 AM PST. It gives validity to what you tell them John said on that date.
H = HUD-1. All banks refer to an estimated closing statement as a HUD-1. Have your escrow company of choice prepare a HUD-1 showing the estimated closing costs. This should reflect all items that you anticipate might be requested on an offer or all items on the offer you are sending the bank. Termite, Septic, Roof, Home Warranty, Buyer Closing Costs. Think ahead and anticipate everything. Be sure the HUD-1 you send has all pages. Check the costs you gave the escrow officer and confirm they are all there. The bank will pick and choose what they approve.
I = Information. Get as much information about your seller as you possibly can. Do a quick prequalification to see if they will even qualify for a short sale. Did they lose their job? Do they have enough cash in the bank to pay off the loan? Did their mortgage rate increase and therefore increase their payment? Have they filed for Bankruptcy?
J = Jump through all the hoops. When a bank says jump you should ask “how high?” Any communication from the bank requesting further items to complete the short sale approval is a good sign.
K = Keep calling. Keep calling. Keep calling. Keep calling. Keep calling. Keep calling.
Keep emailing. Keep emailing. Keep emailing. Keep emailing. Keep emailing.
Get the picture?
L = Learn from your mistakes and the mistakes of others. If someone tells you of a nightmare story on their short sale, ask them how they might have been able to handle it differently to either save time or save the deal.
M = Manage your time wisely. When you make a phone call be sure to verify what time zone you are calling. If the bank is back east be sure you call early in the morning. Find out what hours they are open and avoid lunch hours and after hours. Be prepared to spend anywhere from 10 minutes to 2 hours on hold while you are transferred from person to person. Allow enough time to get through these transfers without having to hang up and leave for another appointment. Have something else productive you can do while on hold. It will make the most of your valuable time.
N = Never assume anything with the lender. If they send you a letter telling you they will pay a certain amount of the buyers closing costs make sure you ask specifically if they will pay items such as discount points, termite costs or other items they might consider as non-essential items. Don’t try to “sneak” in something. The banks will not allow escrow to close until they have approved the final HUD-1.
O = Offer assistance throughout the transaction. Always ask the lender if there is anything else you can do to help them. It will make them feel as though you are their partner in the deal not their adversary trying to get something through they won’t approve. Offer assistance to your client. Let them know you can fax or email items on their behalf.
P = Prepare your clients for a time line of 14 days to 120 days for approval of the short sale. Each lender completes the transaction in a different amount of time. If you are representing the buyer, prepare them for the same time frame. If they are unwilling to wait for their offer to be approved suggest they may want to make an offer on a house that is not a short sale.
Q = Questions! Ask questions early and often, to the seller, to the lender, to the other agent. If you are representing the buyer in a short sale, mark your calendar to email or call the listing agent one to two times a week. This will remind them they need to be contacting the bank.
R = Read all approval letters carefully. The lenders don’t always explain what they will and won’t pay for. Make sure you understand if there is not an approval for a termite report, septic report, roof certification, home warranty etc. If it is not spelled out in the short sale approval letter email or fax for further clarification. Get your answer in writing so you have a paper trail.
S = Stay in touch. Contact your buyer’s agent on a regular basis to let them know of your faxes, emails and conversations with the bank. This will help them to communicate with their buyer. It may just give the buyer the patience needed to hang in there.
T = Truth! Always tell the truth about the situation with your seller. If they try to qualify when they really don’t, the bank will find out. Banks have learned all of the tricks borrowers use these days to get around the rules. Don’t put yourself in a position of taking part in something that is wrong. Walk away and don’t look back if there is any sign of impropriety.
U = Unite with your seller to bring the deal to a successful close. Without the cooperation of seller and yourself you will struggle. Become a team with one goal – completion of the transaction.
V = Verify all information. Most important are the loan numbers, social security numbers, fax numbers and phone numbers involved in the transaction. If you send something with the wrong loan number or to the wrong fax number, or leave a message on the wrong answering machine, you will not complete your transaction. If you have a problem, don’t hesitate to ask for a supervisor. They often have more information available to them then the person answering the phone or the negotiator.
W = Work is all it takes. Be willing to put in the time it will take to make the phone calls, send the faxes and keep in touch with the buyer and seller and their respective agents. We are not in this business to sit at home and watch soap operas and eat bon-bon’s. Be diligent in your work habits and you will be successful.
X = X-ray your transaction on a regular basis. If you really take a close look inside, you will find where the problems might exist. Your diligent efforts in examining everything with a fine toothed comb will allow you to repair any damage before it causes the whole transaction to fall apart.
Y = You are the key to the success of the transaction. You have the knowledge, the skills and the perseverance to make it happen and you will!
Z = Zero in on the short sale market. With the new stimulus package in place and the pressure being put on the banking industry, you will find more and more cooperation on short sales. Banks have been scrutinized and put under the microscope so much that they are looking for ways to make deals work and stop the hemorrhaging of foreclosures. TAKE ON THE SHORT SALES AND MAKE THEM HAPPEN. IT IS GOOD FOR YOUR INCOME AND IT IS GOOD FOR THE HEALTH OF THE TEHACHAPI REAL ESTATE MARKET!
Basic Steps in the successful negotiation of a Short Sale – there are other barriers that we have to overcome that are different from case to case. We are RE/MAX of Santa Clarita and The Paris911 Team – Hoping to assist you with anything you need. 877-977-7362 (REMAX)
Connor MacIVOR
RE/MAX of Santa Clarita
Directions to our Office
Paris MacIVOR
RE/MAX of Valencia
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