The “road map” or foundation to a successful short sale outcome starts with understanding the four qualifications for a short sale and then determining whether the home owner is a good candidate or not. Those four qualifications are:
1. The homeowner must need to sell, not want to sell.
2. The homeowners must be experiencing a genuine hardship that has made a significant change in their life since they took out the loan, which now prevents them from paying the mortgage, such as:
• Loss of job or employment
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• Business failure
• Severe illness
• Major health expense
• Divorce
• Legal separation
• Damage to the property
• Job relocation
• Military service
• Death of spouse or wage earner
• Death of non-wage earner
• Property insurance or tax increase
• Payment increase or mortgage adjustment
• Inheritance
• Incarceration
3. It must be clear that the homeowner does not have assets to pay off the mortgage.
4. It must be evident that the homeowner is having or will soon have a financial short fall.
Once you have established that a client meets the above criteria for a short sale, the next steps are all about details, from securing the right information from the seller to successfully translating that information to the lender. We’ll explore this in detail next month. When done correctly, you’ll be surprised at how lucrative this segment has become.
Mona Koussa is a short sale specialist with CDPR and SFR designations. Mona serves the east bay real estate market.
George “Gee” Dunsten, president of Gee Dunsten Seminars, Inc., has been a real estate agent and broker/owner for almost 40 years.
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