Approach a short sale as if you are an attorney preparing for a big case. It is your job to provide and abundance of evidence to support the lender accepting your short sale. It should be your goal to do the lender’s job for them thereby making it easy to accept your short sale offer.
The sad truth is the lenders are understaffed and dealing with short sales is a tremendous challenge. In recent years the markets were strong and many lenders eliminated most of their loss mitigation departments and are scrambling to put the proper people in place. You need to realize that most loss mitigators lack experience and the ability to reason logically through the alternatives.
With a lack of experienced loss mitigators the lenders have put in place checklists and guidelines for their employees to follow. Because of this you will likely meet resistance if the loss mitigator can not “check the box” to show something has been provided no matter how idiotic the request. Just recognize the loss mitigator is looking for ways to check of little boxes and it will help you with the process.
Now that you have a better understanding of the loss mitigators you will be working with it should help you realize the importance of putting together a great short sale package. It all starts with the Letter To The Lender.
Letter To The Lender
The letter you want to create include the following:
- Loan Number. Without a loan number nothing exists in the lender’s world.
- Foreclosure date. If the foreclosure date is know list it in a bold print that is easy to find.
- Borrowers name.
- Property Address.
- Borrower’s situation. Include a short paragraph about the borrowers situation. Example: Due to extreme personal and financial circumstances Joe Jones has been unable to meet his financial obligations.
- Borrower has requested to work exclusively with you.
- Reference your Power Of Attorney
- The Property is Over financed.
- Falling Real Estate Market. Go into detail if you can. Create a standard doom and gloom paragraph for your area and use it in all of your short sales.
- Discuss lenders position. Empathize with their position. Acknowledge they do not want to get the property back as an REO.
- Difficult Situation for all parties.
- Short Sale Offer. State your offered price as payment in full.
- Mention deed is in escrow. This politely tells the lender you are in control of the property.
- No Listing Agreement Provided. State the reason why. This allows the loss mitigator to check off one more box.
- Your contact information.
- A list of the documents included in your short sale package
The letter I use covers all this and a little more in less than two pages. It will serve you well to spend some time creating the right letter or using our software HERE