Bonita Springs Short Sale Checklist
Chris Griffith is a licensed Bonita Springs real estate agent and not a tax attorney, real estate attorney or C.P.A. Anyone that is faced with foreclosure or a short sale should seek the advice of a real estate attorney and tax professional. This article is provided only as a guideline and is not meant to replace professional legal or tax advice.
A very brief outline of a short sale:
- Bonita Springs home owners must be able to show a lender why they are behind on payments and can't catch up.
- A real estate agent must find a buyer for a short sale and negotiate with the lender for a price.
- A homeowner can't walk away with any of a house's equity from a short sale.
- A short sale is still a mark against a homeowner's credit, but it's a smaller hit than a foreclosure.
- Homeowners must be investigate whether there will be tax on the forgiven balance of the mortgage.
• An owner should NEVER sign the home over to any group before a sale. A short sale closes like a regular sale between a buyer and seller.
A list of items you will need to prepare for a Bonita Springs short sale:
If you're interested in working with your bank to accept a short sale, there are many documents you'll need to gather.
Most banks have a loss mitigation department. It is the loss mitigation department's job it is to resolve problems associated with a defaulted mortgage loan. Often, you'll be working with a loss mitigation officer charged to help the bank minimize the loss due to a loan in default. Each bank is different and has its own guidelines and requirements. It should also be stated that some banks will not consider a short sale until you actually are late on your loan, and have received an offer on your property. It's essential to have the short sale package of required documents ready so that you can work thru the process quickly. Some buyers may not want to wait weeks or months to navigate a short sale, so to expedite a fast, successful sale, get your paperwork in order. Although your lender may have slightly different guidelines, the following items are commonly required:
- Listing contract
- Sales contract
- Hardship letter
- 2 years W-2's or tax returns
- 2 months pay stubs
- 2 months bank statements
- Recent statements for 401k, retirement, investment accounts
- Financial statement listing current liabilities, assets and income information
- A letter of permission authorizing your real estate professional, your attorney and/or C.P.A. to speak to & negotiate with your lender on your behalf.
The loss mitigation department may request additional information and documentation in order to verify the change in the borrower's financial situation and hardship. It may also be noted that some of the requested documentation may lead to re-verification of your financial status at the time of your loan origination.
Regardless of your situation, it is still the bank's decision as to whether to accept the short sale terms. Some find that no matter what they do, foreclosure is inevitable.But that is why it is imparative to have an experienced real estate agent working on your behalf.
Feel free to print the complementary short sale check list. Use the list to organize your documents to prepare for your Bonita Springs short sale.
Helpful articles at Loss Mitigation Frequently Asked Questions by HUD
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