Preparing for a Glendale Short Sale

Sadly, this is a topic that never seems to go away.

If you’re currently behind on your mortgage payments or are anticipating falling behind on the payments, a short sale may be appropriate for you. For those unfamiliar, a short sale is a sale where the seller owes the lender more on the mortgage than their home is worth.

Before listing your home for sale, though, there are a handful of things that you absolutely have to do for your own sake …

1) Contact an attorney. Short sales are not appropriate for everyone and there may be tax consequences that go along with the sale. Talk to a real estate attorney to see if you are better off with a short sale or letting the home go to foreclosure. (Bankruptcy also may be an option for some.)

Side note – there have been agents who have complained in their own circles about lenders who recommend foreclosure more often than short sales because of the loss of a possible commission check. I’m pretty much the opposite, understanding that short sales are not a viable option for everyone. If the attorney recommends foreclosure for you, I’m fine with that and the commission check be damned.

2) Contact your lender(s). Most lenders have a short sale package that they will send out with a list of the information that they need. The information is relatively standard across the board; the one major piece that changes from one lender to the next is the financial information sheet where you list assets and liabilities.

3) Gather the needed information. As I said, it varies but usually includes:

  • Last 2 tax returns
  • Last 2 bank statements
  • Last 2 paystubs
  • Hardship letter
  • Financial information sheet
  • Third-party authorization

The last form, the authorization, allows an agent to talk to the lender on your behalf to work through the short sale.

4) Get your home listed.┬áLenders almost always want your home listed with a real estate professional (as opposed to selling yourself as an unrepresented seller.) As a side note, this isn’t the time to list your home with your friend’s hairdresser’s cousin who just got their license.

If you need names and numbers of foreclosure and/or bankruptcy attorneys, let me know and I can pass them along.

Jonathan Dalton

Jonathan Dalton is a 40-plus-year resident of the Valley and has been helping folks buy and sell homes since 2004. He can be reached at 602-502-9693 or info at allphoenixrealestate.com.

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