What to Expect After Submitting the Short Sale Proposal

After finally finding a serious short sale buyer and sorting through all the paperwork, making sure each of the lender requirements have been met, you are now ready to submit the short sale proposal. However, if you think that once you have submitted the proposal, you can sit back and relax, think again. You need to know what you have to expect after this step in the short sale process in order to make the necessary preparations.

There are several possible outcomes:

1. Short Sale Proposal is accepted. If the lender finds your proposal to be acceptable, you will need to notify the buyer immediately and proceed with the closing. Obviously, you will need to move out of the home soon so you also need to think about this and start looking for a place to move into. Soon after this you’ll need to start making arrangements for a place to move into.

2. Lender makes a counter –offer. This is still considered good news since it means the lender is willing to negotiate. You can respond to a counter offer by agreeing to the lender’s demand or asking for a re-appraisal to justify the initial offer, especially if the lender based the counter offer on an earlier appraisal. Also, if the lender is asking for upfront money, your short sale realtor should be able to negotiate this particular requirement.

3. Lender rejects proposal. In this case, you need to go over what went wrong. There are several reasons why a lender might reject a proposal. For example, a low offer, incomplete papers and absence of hardship. If there is time, you can re-submit your short sale proposal.

Whatever the outcome is, you have to be ready in order to avoid wasting time. Keep in mind you and your Short Sale Realtor are working overtime to make sure you avoid a foreclosure.

When Buying a Short Sale, Consider These Factors

With the real estate market brimming with investment opportunities, it is only right homebuyers go out and find out for themselves which of these properties are worth their hard earned money. To no one’s surprise, many are looking into short sale homes for their more affordable prices.

But the question is: can anyone buy a short sale property?

Well, to be able to answer this question, you need to consider these factors:

1.       Resources – before you even think about looking at listings, you need to really look hard at your finances. Find out how much you can truly afford and always consider the worst case scenario, especially if you are planning on refinancing the home. Speaking of which, secure a pre-approval loan letter from a lender. This document will not only show you how much your budget is, but it can also establish your credibility as a buyer.

2.       Knowledge of the Process – a short sale is not as straightforward as a typical home sale, so you need to brush up on the process. Better yet, hire a short sale Realtor who probably knows the ins and outs of the business and has the experience which will surely come in handy during tough situations.

3.       Knowledge of the Short Sale Home – it does not mean because the home is in short sale it is automatically a good investment. You still need to do your homework and check the investment potential of the property. You might also want to first confirm its status to be sure it is still being sold via short sale.

Lastly, you need to prepare yourself for the short sale journey ahead of you. Prepare yourself not only financially but mentally and emotionally. There will be challenging moments as short sales are known to become quite complicated.

Tip for Short Sale Realtors: Set Realistic Expectations

Being in the short sale business, Realtors often find themselves getting excited about every prospective sale. Most get frustrated halfway through the process and start unraveling at the seams. Perhaps, it is because of unrealistic expectations. After all, a short sale can be one of the most sophisticated real estate transactions you will ever encounter and it will surely pay off if you give it the respect it deserves.

To help you avoid falling into a hopeless pit midway through the short sale process, consider these three tips:

1.       Accept short sales for what they are — complicated transactions. If you underestimate short sales and make the mistake of not really getting to know each nook and cranny of the process, you will find yourself way in over your head. For this reason, a new breed of Realtors has to be born to handle them. You just cannot rely on basic knowledge; you have to master everything related to this transaction from signing on a client to closing.

2.       Practice patience and humility all the time – in many cases, you will find yourself swimming in documents related to a short sale transaction. There are also the calls from the seller and/or the buyer you need to attend to especially if the lender approval is taking too long. Of course, you will be dealing with the lender as well. With all this on your plate, you can really feel overwhelmed. If everything becomes too much, take a deep breath and walk around. You will not gain anything by succumbing to the pressures of the business.

3.       Do everything with care – there are so many things which could go wrong with a short sale transaction such as the buyer walking away, the lender rejecting the proposal for not complying with their requirements and even the seller changing their minds at the last minute. This is why it is important for short sale Realtors like us to take each step cautiously and make sure all “i”s are dotted and “t”s crossed. It pays to be meticulous when it comes to short sales.

The Realities of a Palm Beach Florida Short Sale

A lot of cash-strapped homeowners in Palm Beach certainly appreciate having the option to sell their home via a short sale. Of course, there are many facts about short sales you need to familiarize yourself with in order to truly understand the process involved and determine if it is indeed the answer you have been looking for.

 

Reality #1: Lenders approve Palm Beach short sales IF you convince them of your hardship.

 

In a short sale, the lender accepts an amount less than what is owed on the mortgage because of financial difficulties on the part of the homeowner. In many cases, the deficiency or difference between the mortgage balance and the short sale proceeds is even forgiven, resulting in the owner walking away virtually debt-free. The big requirement is you need to convince the lender you are deserving of the short sale.

 

Reality #2: Palm Beach Short sales take twice  even three times as long as regular home sale.

 

Even if you have all the proper documents, a very good hardship case and a qualified buyer, the short sale can still be lengthy and riddled with complication. It would be smart to find out first if your lender is willing to consider a short sale. If they are, you need to look for an experienced and knowledgeable short sale Realtor to help you out with the entire process. You will find your situation to be a lot more bearable with someone on your side.

 

Reality #3: Securing buyer interest is a must.

 

There are many instances when all aspects of the Palm Beach short sale are going smoothly and then just when the lender gives the go signal, the buyer is nowhere to be found. Such a scenario is hard to avoid as there are really no signs it may happen. You should consider putting safe guards in the form of a earnest money deposit to establish the person’s seriousness about the contract.

Opting for a Palm Beach Short Sale? Know What Docs to Prepare

For most underwater homeowners, a Palm Beach short sale is the only “exit” which should be considered. After all, it is the only alternative which allows you to save your credit history from being devastated as a result of a foreclosure entry. In addition, a short sale could possibly free you from your mortgage debt and let you walk away from your home guilt-free.

 

Making the decision to do a short sale is actually the easy part. You need to understand there is so much more involved than a simple selling of your home. For starters, you need to convince the lender it is the best option, not only for you but also for them. In order to do this, you need to present the following documents:

 

1.       Tax returns for the past two years as well as W-2s and schedules

2.       Bank statements for the past two months

3.       For self-employed: statement of loss and profit

4.       Copy of the mortgage payment/statement

5.       Letters/Notices of Defaults

6.       Hardship documents like bankruptcy papers or divorce decree

7.       Hardship letter

8.       Listings agreement

9.       Sales contract

10.   Pre-approval letter and proof of funds (provided by the Buyer)

 

Essentially, these are the documents which are needed by the lender to decide whether you are indeed no longer capable of fulfilling your mortgage obligations and eligible for a Palm Beach short sale deal. Depending on the lender, other documents might be required and you need to comply with such requirements to get your short sale proposal approved. Work with a short sale Realtor for an easier time.

 

Of course, Palm Beach short sales are known to take time so you need to be patient. Make sure you keep communication with both the buyer and lender open at all times. At the end of the day, doing your homework and practicing due diligence will pay off.

Recipe for a Successful Florida Short Sale

There are plenty of reasons why you would consider a Florida short sale — you could be underwater on your mortgage or at risk for foreclosure. The good news is, you are on the right track. The fact you are considering a short sale means you somehow understand how it works.

Of course, understanding the entire Florida short sale process is just one of the requirements. In order to enjoy success, you also need the following ingredients:

-          Team of Experts: going about the Florida short sale alone is probably not a good idea considering how complicated short sales can be. Instead, hire professionals who will assist you such as a real estate attorney and a short sale Realtor. These experts certainly know their way around short sales guaranteeing all risks are reduced and issues managed.

-          Patient Buyer: another key ingredient in a successful Florida short sale is a buyer who is willing to work with you all the way. It is not unusual for a buyer to suddenly decide to walk away especially if the lender is taking too long in responding to the proposal. For this reason, you might want to consider asking the interested buyer to make an earnest money deposit.

-          Accommodating Lender: even with short sale experts and a serious buyer, all your efforts will go to waste if you experience problems with your lender. The trick is to play by their rules and submit all the required documents. You will also need to establish open communication.

Lastly, your behavior will dictate the success of the Florida short sale. Like your short sale Realtor, you need to be professional in your dealings with the buyer, lender and everyone else involved in the transaction. You will also need to practice patience as well as keep an open mind.

Florida Short Sale Buyers Should Also Check Non-Institutional Liens

In the last few months, lenders have finally woken up to the fact Florida short sales are the more practical solution for addressing distressed borrowers as well as those who are underwater on their mortgage. Not only are they practical in terms of the length of processing but also in cost.

Of course, sellers have the responsibility to prove they are worthy of the short sale approval given by the lender. On the other hand, the buyer needs to do due diligence in order to avoid surprises and even delays during the final stages of the short sale process.

One such surprise involves the non-institutional liens in the form of tax liens or child support. Buyers should be aware that lenders or the other lien holders might not be willing to use part of the sales proceed to pay off such liens. As a result, the Florida short sale may not close and force the seller to take the foreclosure path.

In order to avoid this particular problem, the buyer needs to order a title search and even request a statement from the seller with this information. This way, the buyer can determine if there are indeed liens attached to the property or just the individual. If there are indeed non-institutional liens, the buyer should inquire if the liens are being dealt with. Otherwise, the Florida short sale deal might never be approved.

Of course, buyers can always choose to help the seller in dealing with the non-institutional liens. It could be an arrangement between the buyer and the seller and could be included in the short sale proposal. In this instance, a short sale Realtor might be able to provide sound advice on how to go about this and make sure the chances of getting a short sale approval is greatly-improved.

Successful Short Sales Start with the Right Seller Attitude

With the popularity of short sale growing, it is not surprising why many homeowners are considering it as a foreclosure alternative. However, unlike traditional home sales, short sale transactions can be quite lengthy and complicated. For this reason, sellers need to have the right attitude. 

Patient – for starters, you need to be patient, since it can take time to find a buyer who is willing to wait for lender approval and even longer for the lenders to respond to the proposal.

Thorough – since the short sale proposal will be the basis of the lender approval, you need to make sure you include every bit of information you have which will justify your desire to sell the home via short sale. Not only this, but the documents need to be updated as well.

Organized – with all the required paperwork, you will certainly find a short sale to be much easier if you are organized. This organization should not only cover the short sale package, but it should also cover how you work with your short sale Realtor and deal with the buyer.

Flexible – you need to remember you are the one stuck in an unfortunate situation and the only way you can remedy it is by being agreeable. Try to bend over backwards especially if this will help seal the deal.

Optimistic – there is no doubt there will be challenging times ahead and you need to stay positive throughout, in order to avoid feeling frustrated or discouraged. Just keep believing somewhere out there is a buyer who will make a reasonable offer and then you can easily convince your lender to agree to the sale.

The right attitude will certainly make a short sale go through, however complicated it may be. Again, working with a professional short sale Realtor can be a lot of help.

Florida Short Sale: the Most Effective “Exit Strategy”

One of the worst things that could appear on your credit report is a Florida foreclosure entry. It will certainly tarnish your credibility and would make it difficult for you to take out loans or even apply for credit cards. For this reason, many distressed homeowners in Florida are looking at short sale as the best exit strategy.

If you are not familiar with the premise of a short sale, it is actually a real estate transaction wherein the lender agrees to accept sale proceeds of the mortgaged home with an amount less than the actual mortgage balance. By going through this route, you have more control of what is happening and will most likely suffer minimally, in terms of your credit history.

What is great about applying for a Florida short sale these days is the oversupply of foreclosed properties, forcing more and more lenders to accommodate short sale proposals because they are generally cheaper to process. In addition, the home is taken off the market and the lender need not worry about holding costs and finding a buyer.

In addition, a Florida short sale home is so much easier on the neighborhood, since it is not unusual for the homeowners to continue to reside at the house until the entire process is completed. This means the home will not likely fall into disrepair.

Of course, troubled homeowners need to realize Florida short sales are not without risk. There is always a chance the buyer will walk away or the proposal is rejected. Also, it is not guaranteed the lender will not come after you for the deficiency judgment. In order to manage all these, you should consider working with a professional or professionals such as a short sale Realtor and a tax attorney. It is always a smart decision to work with these people because they can give you sound advice.

Consider A Florida Luxury Short Sale Now Before It’s Too Late

A lot of distressed luxury homeowners are on the fence about applying for a luxury short sale. Whatever the reason behind this indecision, you should know time is not on your side. As it is, there is a particular federal law which could impact your decision if made too late.

The Mortgage Debt Relief Act of 2007 gave homeowners a window for the refinancing of their mortgage without having to pay any taxes on any amount in debt the lender decides to forgive. This window covered a period of 3 years and is set to expire on December 30, 2012. This means any forgiven debt after the expiration of the Mortgage Debt Relief Act will be taxable.

In addition, Florida laws are quite clear when it comes to lender suing homeowners for a deficiency judgment. You will need to get a move on and start your luxury short sale proposal in order to beat the December 2012 deadline.

Aside from this tax break, distressed Florida borrowers will certainly find a short sale much more appealing considering more and more lenders are agreeing to accept less than what is owed to them in mortgage debt instead of pursuing a foreclosure. This is because a Florida foreclosure will turn out to be more costly and make their books balloon with REO inventory.

Of course, there is the fact a short sale can prove to be less damaging to your credit history compared to a foreclosure.

You have to understand, a short sale can be a lengthy process riddled with complications. If you fail to prepare a proper proposal, one with complete, accurate and updated documentation, you will find yourself waiting for an approval which will never happen.

For this reason, it is recommended you work with a professional Florida luxury short sale Realtor, someone who can guide you every step of the way and make sure you avoid the common pitfalls.