Palm Beach Gardens Florida Short Sale Steps

by Rodney Forbes on September 26, 2012

West Palm Beach Short Sale RealtorFor both buyers and sellers, the steps to a short sale may seem to be blurry and complicated. Buyers may be discouraged with the drawn out short sale approval method, while sellers may understand in Palm Beach Gardens, Florida that their lack of knowledge surrounding real estate short sales can be nerve-racking and concerning as they think over the financial and legal consequences of the process.

While the short sale process may be difficult and full of potential complications, for a realtor who has a feel for and is familiar with the short sale process, it will be fairly habitual. An experienced short sale specialist is able to assist you through a successful short sale and lend advice, guidance and support along the way.

Real Estate Short Sale Process – Step By Step

Here below are some of the steps you will walk through with your short sale specialist so that you will be sure of a successful short sale and a fresh start for you and your family. While the specifics and documentation required may vary a bit from lender-to-lender or state-to-state, the general short sale process will be the same.

1. Find a Qualified Real Estate Short Sale Specialist

In the current market, there are many listing specialists who – while they may be excellent realtors – simply do not have the experience to successfully initiate a short sale. There are many bumps and hairpin turns on the road to a successful short sale, and many things can go downhill in the process. You’ll want to have a knowledgeable short sale realtor who can help you direct this difficult road.

Be sure that when you’re looking for a short sale Realtor, you analyze their previous track record and experience with short sales. You’ll want an experienced short sale realtor that has successfully helped many homeowners through the short sale process, and who can achieve the same results for you.

2. Prepare a Short Sale Hardship Letter

In order to get your lender to release their lien on your home and permit a short sale, you must create a hardship letter giving reasons as to why you need a short sale. The more heart-breaking and challenging your situation is, the better your hardship letter will sound. Banks are also much more favorable towards in West Palm Beach homeowners who are in a financial bind due to external or personal situations such as loss of employment, medical emergencies or illness, divorce, death, bankruptcy. Your short sale expert may assist you with the specific content on your short sale hardship letter.

3. Prepare a Short Sale Package

West Palm Beach Short Sale RealtorThere are three essential basics that must be met for a bank or mortgage lender to grant a short sale: the seller must provide hardship, the seller must also display evidence that the fair market value of the home is lower than the mortgage, and the seller must show that they are unable of meeting their debt obligations. In order to prove the latter, the homeowner will need to put together a short sale package for submission to their lender.

Each lender’s submission requirements may differ, but they are generally searching for proof that the homeowner isn’t capable to honor their debt. It is important to seek after the help of an experienced short sale realtor in preparing your short sale package, but the basic contents of your short sale package will typically consist of the following:

. Your hardship letter for short sale

. Completed financial statement

. 2 years of your W-2s

. 2 years of your annual tax return

. List of recent comparable sales or comparative market analysis – In order to give proof that your home will not sell for a sufficient amount to cover your mortgage, you will need to substantiate this fact with a comparative market analysis. Your real estate agent will prep this for you.

. Letter of authorization – this document permits your lender to disclose information to and work with your short sale specialist, lawyers, or other 3rd parties involved in helping you with your short sale. Your letter of authorization will involve your loan reference number, your full name, the date, your agent/lawyer’s name as well as contact.

. Recent bank statements

4. Put Your Home on the Market

You’ll sign a listing agreement with your short sale agent, though it will be subject to short sale approval from your lender. Your realtor will then put your home on the market and solicit buyer offers as they would with a normal listing.

5. Accept an Offer

West Palm Beach Short Sale RealtorYou’ll accept an offer that is close to or at fair market value. The lender will not approve a short sale if the offer is substantially lower than the market value.

6. Submit Buyer’s Preapproval Letter, Earnest Money Deposit, and Seller’s Short Sale Package to Lender for Short Sale Approval

As soon as you have accepted the proposal, your short sale realtor will submit the buyer’s preapproval letter, their earnest money check, as well as the short sale package you and your realtor have prepared to the lender. At this stage, most lenders have an internal process for managing short sale approvals, and a loss mitigator will be appointed to your file. It may take anywhere from a few weeks to many months for your short sale to be accepted or rejected.

This is another part of the process where it’s important to obtain a short sale specialist that will work for you. A knowledgeable short sale realtor who has experience in short sale negotiations is far more capable of getting  your short sale approved in Palm Beach Gardens, FL and obtains forgiveness for the deficiency. An experienced short sale negotiator is also more likely to get a short sale approval more quickly by consistently following up with your lender and pushing the process forward.

7. Receive Short Sale Approval

If your short sale is approved, the bank will send a short sale approval letter. By this point, you may have been waiting a few weeks or perhaps even up to half a year for a short sale approval. The length of the short sale approval process will depend primarily on the lender, though in some instances your short sale negotiator may delay or speed up the process.

8. Deal closes & Lender Releases Lien

The buyer will deliver the funds, the seller will deliver the deed, and the lender will release their lien on the property. Depending on the short sale agreement negotiated by your short sale negotiator/short sale realtor, you may now be relieved of your debt responsibility. Rather, it is possible that you didn’t qualify for debt forgiveness and you will still be held accountable for the deficiency between the proceeds of sale and your initial debt.

West Palm Beach Short Sale RealtorWhile it is not always possible to receive forgiveness of the deficiency in every short sale, yet this is another account as of why you’ll want to work with a short sale expert rather than just any listing agent. A realtor with experience in short sale negotiations ensures that you have the best potential at obtaining full forgiveness of your debt. Experienced short sale realtors in Palm Beach Gardens have much knowledge in working with loss mitigations in negotiating forgiveness of short sale deficiencies and can do the same for you. With the right expert and handling, your short sale might just be your solution to a fresh start, so be sure it’s in the right hands.

**Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email

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