The short sale process is not rocket science, but there are specific rules that an investor must follow. Number one is finding potential foreclosures and number two is finding homeowners and lenders who have agreed to a short sale.
Deal with the lender
Successful investors take action and start the process and get a property for less than it’s worth by doing the following:
1.Contact the lender directly
o This is hard work but it comes with great rewards. By contacting the lender directly on a looming foreclosure, you gain first rights in prime real estate.
2. Authorization to Release Information
o In order for a lender to legally talk to you about your mortgage, this form must be signed. A short sale cannot proceed without the permission of the property owner, but many endure the foreclosure process in hopes of saving their home.
3. Get an appraisal
o If a homeowner and the bank agree to a short sale, there is still a lot of work to be done before a price can be set. A lender will want you to have a home appraised to get an idea of how much the property is worth. The lower the price, the better it is for the lender to approve the short sale. An investor should also get one after learning that the owner and the lender are in serious negotiations.
4. put finances in order
o The lender will want to take a look at a few things before the final sale takes place. The lender will want to look at real estate agent commissions, financing arrangements, and any other expenses associated with the final sale.
The process will move forward like any other real estate transaction once the lender accepts the sales price.
