A Short Sale negotiator receives an offer and contacts the short sale lender to inquire about items needed for the Borrower's specific short sale application. The negotiator explains that the property is vacant and that the potential buyers will be ready to close when approval is issued. The negotiator collects the required documents and sends the entire short sale package per the lender's guidelines to the lender for review. The lender denies the short sale because the homeowner did not exhaust other work out options. (Keep in mind, when a property is vacant, the Borrower will not qualify for a loan modification).
The homeowner applies for and is denied a loan modification and then is allowed to move forward with a short sale. During that time, though, the potential buyer loses patience and signs a release of contract. Had the lender been forthcoming about the investor's guidelines, the negotiator would have taken the necessary actions before submitting a ratified contract and would have not wasted time submitting a short sale package only to have the file closed so that the homeowner could apply for a loan modification.
Accordingly, Short Sale negotiators should inquire about investor guidelines with every short sale and should have homeowners with government-backed loans apply for loan modifications before proceeding to short sales.
Contact me at 434-951-0858 or Tucker@TGBLaw.com if you have questions. Thank you for allowing us to send you this email.
William D. Tucker, III
Charlottesville, VA 434-973-7474 | Lake Monticello (Palmyra, VA) 434-589-3636