What You’ll Need to Prep for in today’s Short Sale World!

In this edition we discuss what many of you may feel are basic and common sense kind of things. But be advised, even with all of the education and resources for agents and other real estate professionals; the majority of them still just don’t get it! Why? Because not only is there a TON of information, tips, and techniques to keep up on, there is also constant change in the short sale world. Lenders and laws are constantly changing. And so, it will be supremely important for you to stay up to date!

One of those changes pertains to a new requirement with buyer pre-qualification letters, and their overall ability to verify the funds that they are using to make their purchase. Whereas before lenders would be satisfied with a basic pre-qualification letter that verified that the buyer was pre-qualified to make the purchase, lenders are now requiring much more in-depth information on these letters. They’ll need to see information such as: the interest rate, type of loan, an issue date within 60 days, and the amount that the buyer is pre-qualified for. Additionally, if the buyer is putting a large sum down, be prepared to have to provide a checking or savings account statement that verifies the existence of their down payment.

Along with that, the norm now is that all parties will have additional documents to provide throughout the process. At one time (as some of us who have been doing this for a while can attest) we could send in a completed package at the beginning, and not need to resubmit, or submit any additional paperwork later on. And we could just sit back and relax, and await our written approval letter. That is no longer the case. So make sure to prep everyone for the certainty of having to submit additional paperwork later on. Now, I know what some of you are thinking….why not just complete those documents at the beginning? And send them in right from the start with everything else? The answer to that is 3-fold:

1. Some of those items cannot be sent in at the beginning because they are documents that require updating throughout the process, such as pay stubs and bank statements.

2. For Equator specifically, some of the documents you’ll be asked to submit can only be
submitted when an Equator task prompts you too. This is especially relevant with purchase
contracts. Many agents will question why you haven’t sent in the offer, and so you’ll have
to explain that you cannot until you’re prompted to.

3. Certain documents require the completion of previous tasks before they are even GENERATED, and thus able to be completed. An example of this is GMAC’s Arm’s Length Affidavit. Before you can even have the affidavit in hand to SEND to everyone to complete, you must first complete the “Submit Offer” task. When this task is completed, it automatically plugs the names of the parties involved into the affidavit and provides it for you at that time.

And so be aware of little things like this, and make sure to set expectations accordingly. The objective here is to drill it into everyone’s head that this is 100% normal and part of the process, and not a ton of extra, unnecessary work. In our experiences, agents, buyers, and sellers often grumble at having to complete this extra paperwork and see it as having to “jump through hoop.” But you’ve got to hammer home that that isn’t the case!