[...]... beat the deadlines that can doom a short sale In short, this book has all the information you’re likely to need to successfully complete a short sale Robert Irwin www.robertirwin.com How to Use a Short Sale to Stop Home Foreclosure and Protect Your Finances This page intentionally left blank CHAPTER 1 How a Short Sale Works A real estate broker once told me, Short sales aren’t hard to put through—they’re... they can be quick and relatively easy What Is a Short Sale? When you sell your home (whether directly or through an agent) for less than the balance you owe on your mortgage(s), it is called 1 2 HOW TO USE A SHORT SALE TO STOP HOME FORECLOSURE AND PROTECT YOUR FINANCES a short sale or sometimes a short payoff Many lenders are willing to accept a short payoff (less than they are owed) when the owner cannot... complex transactions Be sure that you consult an attorney and accountant for legal and tax advice before proceeding with one HOW A SHORT SALE WORKS 3 Who Needs a Short Sale? In a difficult real estate market, short sales can be a positive force, especially when you’re facing foreclosure They are extremely useful and can do the following What a Short Sale Can Do for a Seller Here’s what a short sale can do... HOW TO USE A SHORT SALE TO STOP HOME FORECLOSURE AND PROTECT YOUR FINANCES MORAL Then he contacted the lender’s loss mitigation committee Lenders were having so many losses that all the big ones had created committees to handle short sales The loss mitigation committees had separate phone numbers and assigned negotiators to handle the load He quickly faxed in the package He had an answer two days later... mortgage and interest came to $1,667 a month plus taxes and insurance Suvi looked at Chad, and he seemed as shocked as she was “No way!” he said Their total income was only $2,500 a month That would amount to two-thirds of it They had food to buy and clothing and insurance and medical and everything else that a family needs to live on “Not to worry,” Angel said “We can put you into an ARM [adjustable rate... the examples in this book are taken from real life, because of their financial circumstances, the people mentioned 4 HOW TO USE A SHORT SALE TO STOP HOME FORECLOSURE AND PROTECT YOUR FINANCES Figure 1.1 Foreclosures by state and major metropolitan areas in 2008 Data Source: RealtyTrac Inc have requested anonymity, and hence their names and some of their circumstances have been changed The Liar’s Loan... learned MORAL 10 HOW TO USE A SHORT SALE TO STOP HOME FORECLOSURE AND PROTECT YOUR FINANCES Obviously, when something is too good to be true, it usually is Keep in mind, however, that Peta’s short sale enabled her to avoid a foreclosure, although a number of late payments were recorded She didn’t get prosecuted for what was a very sketchy deal And she did have to pay back some money, although at a. .. will allow the lender to talk to an agent, an attorney, and others And it provides help in determining how to find a good agent and to calculate whether or not you, as a seller, actually need a short sale It gives you net sheets to help prove to a lender that a short sale will save it not only time but also money and that the lender should move forward with the transaction xi xii P R E F A C E There are... alternative to having to walk away from their homes This book is the result It’s designed to show you how a short sale can salvage credit and peace of mind It reveals how short sales work by offering many examples of successful sellers It provides the essential elements of a package that you need to give a lender in order to facilitate the sale It explains an authorization letter (and gives a sample) that will... also needed documentation to show their income and assets And it needed to know why it should accept a shorter payoff—why that was more advantageous to it than simply letting the house go into foreclosure Castro had Suvi and Chad write a heartwarming hardship letter about their financial situation He had them include pay stubs and bank deposit records (They had only about $500 in the bank, having used . a Short Sale Works 1 What Is a Short Sale? 1 Who Needs a Short Sale? 3 What a Short Sale Can Do for a Seller 3 How a Short Sale Works 3 Seven Steps to a Short Sale 21 CHAPTER 2 How a Short Sale. and Traps When Negotiating Real Estate Tips and Traps When Renovating Your Home Tips and Traps When Selling a Home How to Use a Short Sale to Stop Home Foreclosure and Protect Your Finances ROBERT. 2 HOW TO USE A SHORT SALE TO STOP HOME FORECLOSURE AND PROTECT YOUR FINANCES CAUTION Who Needs a Short Sale? In a difficult real estate market, short sales can be a positive force, especially