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What happens next with our short sale listing?

We've sent our paperwork to the bank and are waiting for the bank to assign a person to the file. In the meantime we have the house on the market. What is going to happen now?

Well, the house will be put into the system with a notation that it is a short sale listing. The price in the system reflects current market value, which is less than the outstanding balance on the mortgage but a fair representation of values in the system.

After a few weeks, a new analysis will be done on the listing price, and will make a reduction based on latest market value. The real determination of value will be done by the bank once an offer has been sent to them.

Once we get an offer on the house, a HUD-1 sheet is prepared detailing all costs and credits to the transaction and sent with the contract and any pertinent documentation to the bank. The bank will review the numbers and will send for an appraisal of the property. Once the appraisal is returned, the bank then makes a determination on the submitted contract as to whether or not they will accept the value offered, or counter. If they accept the offer, then the transaction will proceed in a normal manner to closing. Prior to closing the bank will let the sellers know of any obligations, if any, that they will have responsibility to pay.

Short sales are stressful for all involved, and every bank processes them differently. When considering a short sale, be prepared to spend time on the process, and to offer up full disclosure to the bank of all of your financials. I tell my clients that anything that is submitted on their tax returns will be reviewed in detail by the lender holding the mortgage to ensure that they are not trying to just take advantage of the system.

If you, or someone you know in Central Connecticut is having trouble with maintaining their mortgage, I may be able to help. Call me for some assistance or to just talk it out.