The Basics of a Short Sale

Banks grant short sales for 2 reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.

A few examples of a hardship are:

•Unemployment / reduced income
•Divorce
•Medical emergency
•Job transfer out of town
•Bankruptcy
•Death
The seller will need to prepare a financial package for submission to the short sale bank. Each bank has its own guidelines but the basic procedure is similar from bank to bank. The seller's short sale package will most likely consist of:

•Letter of authorization, which lets your agent speak to the bank.
•HUD-1 or preliminary net sheet
•Completed financial statement
•Seller's hardship letter
•2 years of tax returns
•2 years of W-2s
•Recent payroll stubs
•Last 2 months of bank statements
•Comparative market analysis or list of recent comparable sales

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