If you are a seller who is interested in selling your home as a short sale, you must be prepared to provide some information to your mortgage lender in order for the lender to approve the short sale. Despite the fact that the information is not wrapped in a box, it is called the short sale package.
Although different mortgage lenders require the seller’s documentation at varying times in the process, it is important to have all of the information below at your disposal in order for your agent to work with the bank and process the short sale.
Here is what you need (it hardly ever varies from lender to lender–although some lenders may have their own forms for some of the items listed):
- Authorization (letter authorizing whomever is negotiating the short sale to speak with the bank on the borrower’s behalf)
- Financial Statement (itemized list of monthly income and expenses)
- Hardship letter
- 2 months bank statements
- 2 years tax returns
- 2 recent pay stubs
- Listing Agreement
- Purchase Contract
- Estimated Settlement Statement (HUD-1) (required so that the bank can see the bottom line—how much they will receive at closing of the transaction)
It can be difficult to pull together this package, especially if you have many borrowers because the entire package is required for each borrower on the loan. However, I guarantee you that if you prepare the documentation thoroughly and early in the process, the short sale process will move along a whole lot more smoothly.
Originally posted at http://servingsandiegocounty.com