Short Sale info for Agents

EXIT Realty DTC short sale instructions and Short Sale Disclosure to Buyer and Selling Agent

  

The Short Sale Process:
Before the bank can approve a short sale there are several steps that need to be done to achieve this: 
  1. All the necessary paperwork needs to be turned in by the seller to all lien holders. 
  2. A negotiator or mitagator from the bank needs to be assigned to the file.  Once the all the paperwork is submitted this can take up 2-4 weeks depending on the bank.
  3. The bank will order a Broker Price Opinion and or an appraisal of the property to determine the market value of the property.  This process can take up to 2 weeks.
  4. The price opinion/ appraisal will go into review and this process can take up to an additional 4 weeks depending on the lender and if it needs to go to an investor review such as Fannie Mae or Freddie Mac.
  5. The BPO/ appraisal process may be repeated by the 2nd lien holder.
  6. When there is a 2nd lien holder involved, often the 1st lien holder and the 2nd will negotiate what the the 1st is willing to pay the 2nd and what the 2nd will be willing to take.  This negotiating process between the 1st and the 2nd Lien holders can take several weeks until they come to an agreement.
  7. Often times there can be additional liens on the property such as: HOA liens, mechanics liens, city and county liens, HUD liens, etc… These liens will also need to be negotiated with the 1st lien holder and/or the originator of the lien.
  8. The short sale process can be a very long process.  It is not uncommon for a short sale to take several months until we get final written approval. 
 
How to write your offer:
The lender and the seller is is looking for the best offer which is combination of purchase price, quickness to close and cash down.  You should always assume you are in a competitive situation and other offers may be submitted after yours.  Therefore, your initial offer should be your best offer.  Typically the lien holder will not ask for highest and best.  All offers must be submitted using MEC or SSA dates.  It is recommended that the acceptance deadline is a minimum of 60 days if not longer.  All offers will be presented to the seller and the seller may or may not sign the offer at seller’s discretion because each offer will be contingent upon lender acceptance and or if short sale lender requries a seller’s signature to process the short sale.  Typically there are no back and forth negotiations between buyer and seller or buyer and short sale lender.  The short sale lender will determine which contract they will approve.  The contract that the short sale lender accepts will become the binding contract and typically all other offers will remain back up offers.  When written acceptance of a contract is received from a short sale lender, only at that time the property will be marked under contract in Metrolist.  It is customary that the closing happens in 30 days or less from when the bank’s written acceptance is issued.
 
 
Please make certain that your buyer reads and understands all the documents required to be presented as part of your offer.  It is also important to make sure that your buyer understands that the short sale lender may not pay for all or part of the concessions that the buyer is requesting or requiring and that there could be additional fees that may be requested from the buyer in order to close. Such as past due HOA fees that the lender or seller will not cover or there could be an additional 3rd lien that the short sale lender may not allow for, etc…
 
Timing and Dates:
 
The lender needs time to process the file, appraise the property and review purchase contracts.  The loss mitagation departments has a procedure to follow and a backlog of files to process.  Lender requirements and timing vary by the lender and the property.  The lien holder’s response time is not in our control.  Lenders often have requirements which must be satisfied before processing offers.  Submit the contract using “MEC” or “SSA” dates.
 
All offers submitted to include the following:
  1. Contract to purchase with MEC or SSA dates, all pages initialed, signed and dated by the buyer and the agent.  It is highly recommended that acceptance deadline is at least 60 days out or longer unless otherwise noted.
  2. Exit Realty Short Sale Disclosure signed and dated by the buyer and Selling Agent. (this form is strictly for disclosure purposes)
  3. Copy of the earnest money check.  Alternative earnest money deadline on the contract should be 3 days “MEC” or “SSA.
  4. All cash offers must submit proof of funds with their offer.
  5. All financed offers must submit a pre-approval letter with their offer.
  6. Due to the fact that short sale properties tend to have more liens, encumbrances, etc. we must engage the Title Company we initially begin the short sale process with, they are an important part of the approval process and requirements for title.  Therefore PLEASE DO NOT ASK to change title companies.
  7. Offers may be faxed to: 303-790-7955, attention Tatyana, or they may be emailed to: tatyana@exitrealtydtc.com.  You may email Aaron at Aaron@exitrealtydtc.com to confirm your offer was received.  Offers received after 3 pm on Friday or Holidays will not be submitted until the following business day.   
Short Sale Updates
 
Short sale updates and information can be found at: www.exitshortsaleinfo.com . The short sale information on all properties is updated once a week.  Please check the short sale website and ALL pages of the spreadsheet for an update on a file. If there are additional questions that are not answered by the short sale update page, please email your questions to: aaron@exitrealtydtc.com OR tatyana@exitrealtydtc.com.  Emails will be answered promptly. 

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