I recently attended a Weichert sales meeting at which a local real estate attorney was a guest speaker. He was there to help us help our clients navigate through short sales. He is one of the only attorneys that I know of who has a dedicated staff member to communicate with the banks and keep on top of each transaction as it works its way through the myriad of steps at each bank.
If you are in a position where you think foreclosure is the only way out – please contact me first – I can put you in touch with the right resources to help you make that decision. A short sale may be right for you instead. If that is the case, it is imperative to get the house on the market as soon as possible since the first thing on the following list is an exectued contract of sale!
To move forward with an attorney’s support for a short sale, you will need to have the following documents:
- Copy of fully executed contract. Don’t worry if the negotiated sale price is lower than the amount of your mortgage.
- Hardship Letter. This is writted by you, detailing the hardship you are facing in keeping up with your mortgage payments
- Copy of the last two years tax returns
- Copy of the last three months pay stubs
- Copy of the lat two months of bank statements
- Written authorization for your attorney to contact the bank and negotiate the short sale
- HUD-1 Statement (the attorney will prepare this)
- Copy of the last two months mortgage statements (for the first and second loan if applicable)
- Copy of the listing agreement
- Complete list of all debts including monthly expenses
- Copy of your 401k and retirement plan(s) statements
- Market analysis prepared by your realtor
- Commission bills provided by your realtor for both the buyer and seller agent
- Back title: includes your deed, the survey and your title insurance policy
The sooner you have all of this information compiled and sent to your attorney, the better. If you want to contact the bank before hiring an attorney you can do that too – the department you want to contact is Loss Mitigation. I strongly recommend using an attorney with EXPERIENCE in this process – there are lots of phone calls required, things move very slowly and then all of a sudden very quickly. It is often difficult to stay on top of where things are in the process. Except for the initial fee, I believe the balance of of the attorney fees as well as the real estate commission will be calculated into the total debt that will be resolved by the short sale.
Information on this post was provided by Rafael J. Betancourt of Triarsi, Betancourt, Walsh & Wukovits, LLC a law firm in Cranford, NJ.
If you are considering a short sale, click here for an estimate of your home’s value in today’s market. This information, along with your mortgage history will help you determine the best course of action.
