Seller Preparation — Documents Needed for a Short Sale
Short sales may be simple or complex, but they are almost always time-consuming. If you are considering selling your home through a short sale, there are certain things you can do to expedite the process.
First and foremost, call your lender. Most large lenders have a division or an outside company that is handling short sales for them; your lender should be able to put you in touch with the right people. Some banks will send you their forms, etc. right away, open a file for you, and then hold it until you have an offer. Other banks will want you to have a contract in hand before starting the process.
Regardless of which route your bank takes, you should assemble documentation to support your short sale right away. If your attorney is negotiating the short sale for you, he or she will want these documents up front so they are prepared for the bank when the time comes. You should have the following documents ready:
1. Completed application package from the lender, if available
2. Signed hardship letter explaining why you cannot afford the home and a short sale is necessary
3. Signed letter addressed to the bank authorizing your attorney to negotiate the short sale on your behalf
4. Copy of your last two months’ bank statements for all personal accounts, including retirement and 401k accounts
5. Copy of your last two months’ pay stubs
6. Copy of your last two years’ income tax returns with W-2s
7. Proof that your property is listed for sale (i.e listing agreement)
8. Monthly budget showing all income and payments made on a monthly basis (if not already included in the lender’s application package)
9. Financial statement showing all of your assets and liabilities (if not already included in the lender’s application package)
10. Sales contract
Every page of every document listed above should have your name, as it appears on your mortgage, and your loan number or file number written on it. Short sales are time-consuming and buyers often back out because of the long wait. Anything you can do to expedite the short sales process will help you complete the process with less hiccups and as quickly as possible!