*****Read and Consider Before Purchasing a Short Sale. First and foremost you need to be qualified to purchase before making any offer on a short sale!
1. First you much be qualified to purchase before making any offer on a short sale. Are you pre-approved for the purchase and can you provide a pre-approval letter from your lender? This is a “must” before a short sale lender will accept a short sale offer on a property.
2. You should also expect a request for a written proof of funds or deposit to close. If the down payment is more substantial, this has become commonplace.
3. Are you willing to pay a respectful earnest money deposit to show that they are focused?
4. Are you willing to have an inspection done at time of mutual acceptance?
5. Are you willing to certify that you are not engaging in multiple offers on various short sale properties?
6. Is your offer contingent? If it is, it won’t be looked at by a lien-holder. Don’t even waste your time.
*****Do You Understand Your Role in a Short Sale Deal?
7. Will you allow extended time for negotiations beyond the sixty (60) day default in MLS Form 22SS? You need to be committed to a six month time period – It may be shorter, but times vary from one sale to the next.
8. You may be asked to update certain information within narrow time-lines, sometimes mere days. Are you willing and available?
9. You should know certain lenders require partial social security numbers, birthdates, and other personal information. Some
short sale lenders require an “in-house” prequalification for a short sale buyer.
10. Are you willing to provide “wet signatures” as most lenders do not accept electronic signatures?
*****Frequently Overlooked Points for Buyers Regarding Short Sales
11. Are you aware that this deal will probably not be the “deal of a lifetime” as the lender is trying to limit losses?
12. Do you know that the whole deal can be terminated by the seller if they don’t like the terms offered?
13. Do you know that the offer price can be countered by the bank for a higher price or eventually rejected?
*****Is The Short Sale Property Itself a Good Prospect?…Will It Close?
14. As the selling broker I will review the title commitment.
a. How many mortgage loans and liens are on the property?
b. Is there Private Mortgage Insurance on the seller’s loan?
c. Are there significant sums of past due homeowner’s association
or condo dues payable?
d. Is there a scheduled foreclosure sale of the property? Is there
time to complete a successful short sale?
15. Are the sellers cooperative? Are they divorced or divorcing?
16. Is there an FHA Loan to be negotiated on the property? If so,
does it have an ATP yet?
17. Will the property qualify for the type of financing
contemplated by the buyer?
*****Who Is Actually Negotiating? Are They Qualified?
18. Who is negotiating with the lenders for the approval of the
Short Sale? Is it the listing broker or another third party providing that
service?
19. Is the negotiator appropriately licensed?
20. Who will be paying for the services of a professional negotiator?
