Many Agents pass up on a lot of possible deals and miss out on hundred’s of thousands in commissions a year out of the fear of a short sale. Maybe its a lack of experience, knowledge, time, or a combination of all that keeps you away from a short sale, but even if you are processing your first one you too can process a smooth transaction.
The first thing you must do if you have never processed a short sale is understand how one works. Knowing the steps is key, the simplest way is to break up the review in sections or milestones. First obtain a complete package or sometimes referred to an application. The easiest way to assure a complete submission is calling the Mortgage servicer and obtaining a list of the required short sale documents. Once a complete submission or package has been received the mortgage servicer will verify a complete package before the file makes it to the valuation stage. With some servicers you can have a value ordered even before you have a complete package.
Most servicers will assign a negotiator or underwriter to the review at this stage, however not all servicers do and you might need to deal with different representatives from the short sale department directly. Different contacts but same concept, approach, and technique. You should start requesting for a Value(Appraisal or BPO) to be ordered on the property as soon as a the package has been submitted. The sooner one is ordered the quicker the transaction can move through the review. Its important to make your self as the Short Sale Processor the main contact for the valuation agent to reach out to when needing to gain access to the property(external values are sometimes completed, in the form of drive by BPO or desktop valuation) Once the Valuation is completed the BPO agent Or Appraiser completes a report that is sent back to the Investor and servicer. Once this report has made it back its important to try and get an estimate on the value they received to plan for possible counters. The investor will decide at this point weather to approve or counter the offer. A wise negotiator maintains a complete package throughout the entire review as certain documents like paystubs , Utility Bills, Bank statements, and profit & Loss Statements expire once more recent documents become available with time.
Once you have made it to the closing if your buyer is cash you must establish if they will be completing inspections, and getting them scheduled as quickly as possible. The Same goes if its a finance offer with the permission of the Buyers Agent and in some cases the Buyer you can reach out to their lender and help get their valuations of the home and inspections completed. The sooner this is done the sooner possible loan contingencies can be met and closing can proceed. An expected closing date should be set as soon as possible as a goal, this date is subject to change but you must do everything possible to close within the approved time frame. Once set closing date is set give your self at least 72 hours to acquire closing HUD approval as this can sometimes take a few submissions to get. Strong and frequent communication must be kept with all involving parties to assure and guide the transaction in the route and pace you want to take it.
The mortgage servicer is playing giant game of telephone with information and you must take control of the review from the start to assure its success. As the Short Sale Processor or negotiator you need to communicate with the mortgage servicer every 48 hours, ask questions don’t get off the phone with them until you know exactly what is happening on their end of their review. The Better understanding you have of what is going on behind the scenes the better you will be able to process the deal and guide it through the different stages of the review and past the finish line.
It’s important to be able to navigate the mortgage servicers and the Investors system efficiently or the runaround can make your review last ages.
If you have questions about an underwater mortgage, loan modification, foreclosures ,short sales , Reverse Mortgage Short Sale please call us at 888-572-8020.