It seems that everyone knows someone who is facing losing their home to foreclosure. It can also be said that if you know a homeowner in foreclosure, the chances are their lender has told them that a short sale as the strategy to avoid losing the home to foreclosure.

While short sales can save many homes from a foreclosure auction, it is a very complicated process and one that should not be taken lightly by the someone who is not educated about short sales.

If you are a homeowner who is facing foreclosure, a short sale may might be for you. However you will need to be open, honest diligent, cooperative and you must comprehend that the following 5 tips are vital to your short sale being approved by the bank:

1. While you may be able in some occasions to convince a bank to work with you, the prudent homeowner knows that they are not an expert and should let the expert in the market handle the short sale. Whether an experienced real estate agent, title processor or attorney, make sure the person facilitating your short sale really is knowledgeable in regards to the short sale process.

2. Make sure you stay actively involved and you cooperate fully with the timely submission of forms and other paperwork as may be needed by the lender. This includes that you, not your agent or advisor, but YOU write a clear and compelling Hardship Letter. Having someone else write your hardship letter may be the reason that your short sale request will be turned down.

3. Make sure you know what is expected of you. The lender is going to want a complete short sale package and that will include a full financial work-up complete with bank accounts, tax returns and more. Your reluctance to give the bank this information could get your short sale request turned down.

4. The bank gave you a mortgage and they have the right to collect. You have the obligation to disclose your assets and to liquidate them to lessen your obligation to the bank. You cant expect to take less while you are seen living large. That’s just not right. You have be prepared to demonstrate a true hardship.

5. Make sure you don’t dilly dally until its too late before you request a short sale. Most homeowners don’t do anything or simply wait to long to act. No real estate agent or attorney is a magician. They need time to make the short sale work. If you want to save yourself from enduring a foreclosure on your home then you must act in timely fashion.

Short sales can take as long as 6 months to get approved. These are just 5 easy tips you can follow to give your short sale request the best chance for approval. This is not a simple procedure for mortgage company or homeowner and your ongoing cooperation can be the reason for a successful short sale or your home being auctioned off.

Whatever you do, don’t sit by and do nothing. If you want to try to initiate a short sale on your own, some banks are now letting homeowners do just that. If you want to find out more information about how short sales should be correctly completed please visit our short sale information resource center for videos and tips as to how to correctly complete a short sale.

By understanding the short sale process you will be better prepared to talk about things with your lender and you’ll be more tuned in to spot inadequacies and shortcomings with any Realtor that you may choose to hire to handle your short sale for you.

If you’re a real estate agent reading this, you too may want to visit our short sale resource center. It will help you learn how to properly execute short sales and generate higher commissions.

This entry was posted on Wednesday, January 27th, 2010 at 6:55 am and is filed under Mortgage Loan Foreclosures. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.