The Reiling Team

DISTRESSED PROPERTY SYSTEM

Our Distressed Property System is activated as soon as we start talking with a homeowner who feels they are in financial trouble and their home may be foreclosed. The short-sale process takes a lot of detail to set-up and complete successfully; the system helps us do it right..

Tips for Sellers –

Success on Short Sales

  • Don’t wait until the lender is about to foreclose. Allow enough time to put the home on the market, find a buyer, get the lender's acceptance and close.
  • Accurate documents, including tax returns and bank statements, will be needed. Incomplete information is one of the most common reasons a short sale is rejected.
  • Price a home competitively for the available time frame, and have a plan for aggressive price reductions.
  • Market the home. A listing on the Multiple Listing Service is not enough. Use all available electronic media, like Craig’s List.
  • Secure a valid contract. The buyer must be pre-approved for financing, submit a short sale disclosure and understand a short sale is not the usual real estate transaction.
  • Communication is essential. The Realtor® must keep the buyer’s agent, as well as the owner/seller, up to date on the progress being made on the sale.
  • Consult with a real estate attorney and an accountant on terms and taxes when negotiating a short sale, and specifically have attorney review the lender’s settlement letter.

Pre-listing Activities

· Meet with the homeowners at their home

· Discuss the Seller Interview Questions (Form O)

· Determine if short sale is best path, or decide  alternate path.

· Determine how much time is available by completing our Timeline Worksheet (Form R)

· Determine the homeowner’s level of expectation, motivation, cooperation and willingness to communicate openly. (Form B)       (This is likely to be an emotional discussion. But a solid working relationship with clear agreement on intent is critical, otherwise - opt out)

· Ascertain the condition of the home (Form L) and document with photos (Form J)

· Review Homeowner Financial Worksheet (Form F) so the homeowner understands how to complete it

· Review the Homeowner Document Checklist (Form E) so the homeowner understands what documentation is needed

· Prepare the Homeowner’s To-Do List (Form G)

· Review a Sample Hardship Letter (Form N) so the homeowner understands its importance and what to include in it. This letter must be prepared by the homeowner.

· Crunch the numbers using the completed Financial Worksheet (Form F) to confirm the homeowner meets the lender’s criteria as a distressed seller

· Verify the submission of the items on the Homeowner Document Checklist (Form E)

· Verify the completion of the Homeowner’s To-Do List (Form G)

Listing Activities

· Execute the Listing Agreement

  • Complete NWMLS Listing Agreement (Form 1)
  • Complete the Listing Agreement Addendum (Form H)

· Complete the Listing Price Worksheet (Form I)

· Complete the Hold Harmless Agreement (Form C)

· Complete the Authorization to Release Information (Form A) and submit it to the lender’s loss mitigation department

· Review the homeowner’s Hardship Letter for completeness and to confirm its accuracy

Upon Receipt of an Offer

· Review the offer with the Seller to obtain approval to submit it to their lender; this is an acceptance of the offer by the Seller, subject to the short-sale approval contingency

· Prepare the Short Sale Disclosure (Form P) and have it signed by the:

  • seller
  • buyer
  • listing agent
  • selling agent

· Prepare the Cover Letter to the lender (Form Q)

· Compile the Short Sale Package. This package consists of approximately 100 pages of material. It documents the seller’s situation and makes the case for the price and why the lender should accept a short sale.

· Fax the Short Sale Package to the lender’s Loss Mitigation department

Lender’s Review of Short Sale Package

· The lender’s review can take up to 60 days.

· Make a weekly follow-up call to the Loss Mitigation specialist to ensure all paperwork has been received and to learn if any additional information is required

· Keep ALL parties informed weekly

  • seller
  • buyer’s agent

· Respond promptly to any questions from Lender

Upon Receipt of the Lender’s Acceptance Letter

· Communicate to all parties that letter has been received

· Have Seller review the letter with an attorney to ensure that all terms are clearly understood and satisfactory

· If agreed, notify all parties, including Escrow, that Lender short-settlement contingency has been satisfied, and that closing can proceed.