UNDERSTANDING SHORT SALES AND THE SHORT SALE PROCESS LEX LEVINRAD
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Proof that the seller is prepared to file bankruptcy can help the case of the seller, since this can significantly
delay the foreclosure process. Many sellers facing foreclosure are behind on all of their bills and so
bankruptcy is a real option for them to consider. This scares the banks since it means more time until they
get to recover the property. If the homeowner has met with a bankruptcy attorney and is contemplating filing
bankruptcy then make sure this information is in the file and is also mentioned in the hardship letter.
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Estimate of damages and repairs needed and the cost of these repairs for the property to be in marketable
condition. You can use an estimate from a general contractor, since in this case high repair estimates will
help justify your low offer.
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A solid case for why the buyer is not prepared to offer more for the property, with supporting evidence. Good
examples are current REO sales prices and estimates of repairs costs for the property, sales at the same
price as the offer price, or other low comparable sales by cash buyers on bank owned properties and short
sales.
After all of this information is gathered by the short sale negotiator, it needs to be put together in a “short sale
package” and then submitted to the bank. The loss mitigation department at the bank then reviews this package
and takes it to their supervisors for review. The process is extremely time consuming and cumbersome and
there is no guarantee that loss mitigation will even be interested in negotiating at all. They can also ask for
additional bank statements and repeatedly request more documents, so it is important that the seller is willing to
cooperate with the negotiator in a timely manner.