The process begins with the homeowner assessing their financial situation. To qualify for a short sale, the homeowner must demonstrate significant financial hardship, such as job loss, medical expenses, or other financial crises that make it impossible to continue with mortgage payments. We will assist you in gathering documentation proving your inability to meet mortgage obligations and the current value of the property.
Once financial hardship is confirmed, we contact your mortgage lender or servicer to request approval for a short sale. This step is crucial, as the lender must agree to accept less than the full amount owed on the mortgage. We will need to submit a formal short sale request, which includes a hardship letter, financial statements, and a preliminary market analysis or appraisal of the property.
After receiving initial approval from the lender, we will list the property for sale. The listing price is typically set below the amount owed on the mortgage, reflecting the current market value of the property.
Once the property is listed, potential buyers will submit offers. We will review these offers to determine which one is most favorable. Once an acceptable offer is found, it is submitted to the lender for final approval. The lender then must agree to the sale terms and the offer amount.
The lender reviews the submitted offer and the associated documentation. This process involves evaluating the offer’s fairness and the financial documentation provided. The lender may request additional information or negotiate terms before giving final approval.
Once the lender approves the offer, the sale moves to the closing stage. During closing, the final paperwork is completed, and the property is officially transferred to the buyer. The proceeds from the sale are used to pay off the mortgage lender, though it is usually less than the full amount owed. Any remaining balance is often forgiven by the lender.
Even though the home is being sold, there are many ways to get financial assistance for your future. Many lenders offer “cash for keys” or other hardship easements to help make the transition much easier. We will help negotiate for these cash incentives and get you moving forward in the best way possible.
After the short sale is complete, the homeowner may need to address any remaining financial obligations. Some lenders may issue a 1099-C form for forgiven debt, which could have tax implications. We can connect you with a financial advisor or tax professional to understand all considerations.
