Steps that you should follow in Real Estate Short Sale

In a short sale, you buy a home with mortgage and you negotiate the mortgage on it. Such property is in foreclosure and with no equity in it. In such sales, the value of the property will be lesser than the mortgage outstanding. So you need to negotiate with the bank to reduce the buying price of the property.

It is very important that you complete all the steps and components of the short sale because otherwise you may lose the deal. So to complete the deal and get the house you want, you need to follow the following basic steps

1. You will have to get a ‘authorization to release information’ from the seller and the spouse and submit it to the bank with whom the property is with now.

2. You will also need a signed sales contract, photos of the property and the proof of hardship to submit to the bank.

3. Make a short sale package for the bank including all the documents

4. Send the package to the foreclosure/mitigation department of the bank. It is advisable to send more than one packet to avoid inconvenience due to loss of your packet.

5. An appraisal or BPO (broker’s price opinion) will be ordered by the bank, which will be carried out by an appraiser or a realtor. Help them to see the factors that make the house worth nothing. It will help you in negotiation later.

6. Negotiate on the price with the bank. It may take some time and you may need to talk many times before you settle down on a price.

After the deal is done, you can get the documents of your new property on a fixed date.