The first key is to make sure you do ALL of your up front work with precision. Do the up front work correctly and the end result will be much better.

Key point #1 Contact the bank to get the list of items that they need for a short sale. Ask them what order they want the items to be in.

Key point #2 Gather ALL of the necessary documents. Make sure the homeowner signs the hardship letter and all areas of the Purchase and Sales Agreement.

Key point #3 Stack all of the documents in order to which the bank has requested. If they haven’t requested a stacking order then I suggest that you put it in the following order….

1. Fax cover sheet
2. Cover letter
3. BPO or Appraisal letter (Tell them to call you for BPO’s or with questions)
4. Hardship letter
5. Purchase and Sale Agreement
6. Hud-1
7. Tax Returns followed by other financial statements

Key point #4 Once you have the items in order you must put the Account # in the right hand corner. You can do this digitally or by hand.

Key point #5 On the bottom of every page put your name, phone number, and email address. Again you can do this digitally or by hand.

Key point #6 Send the packet to the correct department!! This sounds simple but banks have hundreds of fax numbers and it can get lost easily.

Key point #7 Follow up with the bank that they received the packet within 72 hours. Ask them their turn around time.

Key point #8 Gather contacts from the bank on past deals you have worked on and put them in a contact folder. This can be past negotiators, reps, Vp of departments, etc.

If you do these steps methodically then the chances are the bank will call or email you with questions or counter offers on a property before you contact them. Why? Remember behind every house is a homeowner and behind every short sale negotiator there’s a person. Treat the people with respect. Don’t yell at them. They have a 9-5 job that can be grueling. Stand out in your professionalism. If your packet is very accurately and methodically put together with effort and precision, then who’s short sale packet do you think the negotiator will look at first? They will look at the cleanest and best file. They want to get these files off their desks. Help them by standing out and doing an oustanding job. I know it’s time consuming and a pain.

The question I leave with you is this. If you want to get a short sale done and have your file go to the top of the negotiators 150 plus files, then you need to do something that’s different from the hundreds of agents and  short sale companies out there to do so.

I wish you luck in your short sale endeavors!!

Short sales are actually better most of the time. Why? If you owe 300k on your house but it’s worth 200k then in my opinion it makes no sense to do a loan mod. In Portland we see this all the time. People are facing foreclosure and need to sell. If they do a loan mod then they still are in a negative equity position and are essentially renting their home at a lower price for a period of around 5 years until the rate adjusts.

A homeowner can get out a bad equity position and sell their home. Sell house now!!! You can get your credit back on track quickly and buy a home in the near future for thousands if not hundred of thousands of dollars cheaper with a lower payment!

Check out this video for yourself and watch what CNN says about loan modifications and the reality of it.

http://www.youtube.com/watch?v=2DVr9uJ1dJQ

Key Points to a Short Sale:

1. Get the listing if you are a realtor
2. Have seller sign Short Sale Addendums or necessary disclosures (We have additional disclosures that’s not required by our state or MLS.)
3. Gather necessary financial documents from the homeowner.
4. Send Authorization to the bank asap.
5. Follow up with the bank.
6. Order Prelim and search any and all liens.
7. Put short sale packet together PER that Lenders requirements. (Check with Lender)
8. In packet make sure you have Hud-1, purchase and sales agreement!!!!!! (It’s a must)
9. Make sure you have Account # in right hand corner of EACH document. (We do this electronically and it takes about 60 seconds.)
10. Order BPO or Appraisal Asap.
11. Go to all BPO and Appraisals. (Don’t persuade but validate your short sale.)
12. Follow up with bank.
13. Follow up with bank.
14. Did I say follow-up with the bank? (Early morning is best check time zones of lender and lender negotiator)
15. Keep track of ALL records. This includes phone conversations with homeowner, lender, BPO agent etc. (Date and time stamp everything)

These are some really basic steps that will streamline your short sale and keep you out of the court system!! Remember people are sue happy so you must disclose, disclose, and then disclose again.

John Stilwell  www.encorehouses.com

The realtor will need to set up a login and password at   www.equator.com.

The homeowner has to go to www.bankofamerica.com/shortsale and fill in their information  including financials.

Now, this can be difficult because most people are not that computer savvy and like anything it’s new! A lot of times homeowners do not want to take the time and effort to fill out the information. We recommend that you sit down with them and help them through the process.

When you as a realtor set up an account you have to do it each and every time you have a new short sale listing!! For example: Let’s say you have 20 listings…. then you must have 20 accounts with a specific file number that Bank of America uses to identify it.

In the Portland, OR market there are a lot of Bank of America short sale files. Everyone seems to hate them and with good merit. We have positioned ourselves with Bank of America to handle multiple files without the entire hassle. There is hassle of course.

If you have short sales that are a real pain check out www.encorehouses.com/shortsalessellers.php  to learn more.