Tips To Negotiate A Short Sale With Your Lender
In Real Estate, a short sale is a disagreeable transaction. However, it has come a long way and banks are more cooperative in agreeing to a short sale in today’s market.
People can lose their homes to a multitude of circumstances, and selling your property can be a very humbling experience. Your credit will be affected for at least two years and you will have to rent another property in the meantime that may be less than your standards of your beloved home. There are some very good Realtors out there that are professional about the process, and can guide you through the transaction with your dignity in tact.
In this article, we are going to walk you through some of the ways to make your short sale proposal more acceptable to a lender. So, let’s continue reading to learn more.
Present an Authorization Letter
A lender doesn’t like to reveal your personal information unless you submit an authorization letter. Expect to get more cooperation from the lender by presenting a letter of authorization so that your lender can discuss with interested parties the nature of your loan. Make sure that your letter includes the loan reference number, property address, your name, date, and of course your Agent’s name and contact details.
Calling the Right Person
You may have to make several calls before finding the right person who can manage your short sale efficiently. It’s no use talking to any person in the ‘work out’ department. All you need is a supervisor’s name who has wide experience in handling such transactions and capable of making the right decision which proves beneficial to you.
Details of Hardship
This is nothing but the statement that shows how you got into your current financial situation. With the help of this hardship letter, you can make an appeal to the lender to agree to a lesser payment. Remember that lenders are not heartless and they do understand if you were hospitalized, lost your employment recently, or your entire family met with an accident. However, it’s important to note here that lenders have no empathy for situations relating to criminal behavior, dishonesty or fraudulence.
Furnish Copies of Your Bank Statements
In case your bank statements show large cash withdrawals, inexplicable deposits, or an odd number of checks, the best thing to do is to explain clearly about each of these to your lender. If the lender asks you about the large deposits, you will need to account for them in writing.
Show Proofs of Your Assets and Income
It is crucial to be honest about your income, assets, and overall current financial situation. It’s natural for lenders to inquire about your savings accounts, stocks, bonds, money market accounts, cash, negotiable instruments or anything having tangible value. Often lenders will require a declaration that the defaulter cannot pay back any of the amount of the loan which may be forgiven.
Comparative Market Analysis
During economic slumps, home values may drop. If this is the reason why you are unable to sell your house for an enough sum to pay the lender, it should be corroborated through a Comparative Market Analysis or CMA. Your Realtor can generate a CMA for you upon request and show you prices of similar properties that are active, on the market and show sales and pending sales for the last 6 months.