You can always stop foreclosure from happening. One way to do it is through short sale. There are many advantages in resorting to short sale. However, it also has its own downsides. One of it is closing the deal.
Short sale is not as easy as you think. In this transaction, lending institutions would incur a huge loss. That is why, before it can be granted, the banks would have to qualify the homeowner. Another challenge involved is looking for the authorized personnel to grant the request. These people are not visible like the tellers on the bank. Lending institutions may have separate department (called the Loss Mitigation Department) that takes care of this kind of transaction. Therefore, you really have to be patient and learn to ask the right questions.
As mentioned above, a borrower needs to be qualified. To help the lender in evaluating, certain papers might be needed. It is best that you give them all documents required to make the evaluation process smoother. Here are some of them:
O A letter of intent to go on a short sale and the reasons why it is badly needed o A letter that describes the kind of hardship the borrower is going through; including papers that could prove such state o A letter that authorizes the lender to make inquiries and disclose information to parties involved. o The initial net sheet that will reflect the income and the expenses involved in selling the house. o Statement of Accounts which reflect the withdrawals and deposits made from your bank account o A report that shows the house value is the market value o The listing contract which proves that the real estate broker have the right to offer the property for sale. o The purchase offer made by the buyer. o W2 forms and tax returns
Here are other tips that could be used in securing the closing:
O Compliance of these documents will reduce the chances of getting rejected. However, submitting them is not enough. Ensure that the short sale package is complete before submission. o Never lie about the figures that you will be disclosing. o Make sure the information on your short sale package is complete and detailed. o Be in constant communication with your buyer and make sure they do not withdraw their offer. Let them know if there are updates. o Write a letter of hardship that reflects hardship. It would be better if it were dramatic. Write statements that can move emotions so that the lender could see how difficult things are and it is not going to be over soon. o If the lender is not convinced that the house is below the market value, show photos as a proof.
There is no definite time on when the short sale can be closed. However, patience is very much needed. It takes time for the lender to evaluate. They may need a third party opinion to make sure that the offer is acceptable.