There are a lot of different techniques used and taught on how to be successful in Short Sales. You'll also find an array of different blogs and articles on what needs to be included in your short sale package. I want to outline what I believe is the most effective tool in your short sale package.
First thing you're going to want is make contact with the bank and ask them what they require in their short sale packages. As you've probably read many other places it typically is:
Â· 2 months bank statements
Â· 2 months paystubs
Â· 2 years tax returns
Â· hardship letter
Â· P/S contract
Other things may be required by different lenders, the point is to make sure you contact them prior to submitting the packet so you know that you've got everything you need.
You also obviously want to make sure you get the info on where to send the short sale packet. There have been times in the past where I was required to mail it instead of faxing it, either way it's very important to find this out.
The very most important piece of the short sale packet is the Cover Letter. This one piece of paper is what you want the bank employee seeing first as it will make at least a quick first impression, regardless if they forget about you ten seconds later because they have a stack of other files to work. In the case of one of my very first short sale packets sent to Litton Loan Service the negotiator actually remembered me from my short sale packet and mentioned that I should teach others how to property prepare one, she said that the cover letter was very nice and she appreciated my extra effort.
Make your cover letter not only stand out but also make sure ALL the necessary information is on the cover letter. This will not only be helpful to the recipient but also yourself. When making follow up calls to the lender they will usually always ask you things like the last four of the borrowers social and or the address and loan number.
By having all of these in one place it makes it very easy to locate them as they're being asked of you instead of flipping through different papers searching for them.
What exactly is on the Cover Letter? You want every important piece of information and a little something extra, the important things are:
Â· Recipientâ€™s fax number
Â· Your name or company name
Â· Your fax number
Â· Borrowers name
Â· Subject address
Â· Borrowers loan numbers
Â· Borrowers SSI# (at least the last four)
Â· Bulletin of what is included in the packet
That seems like a lot but really when laid out it isn't that much. Most cover letter templates already have places for most of the sender and recipients info to be fill out. The place in the header where you'll need to add some things are the borrowerâ€™s information.
By having these things it not only shows that you're a professional but it also instantly lets the negotiator feel they don't have to educate you on how to do a short sale. The last thing they want is to teach you what you should already know if you're going to be doing short sales.
We have the header taken care of with the important things; we'll need to follow through with a great body or content of the cover letter. The first sentence I always include is; Included in this short sale packet are the items you requested, please open a file up to assure a smooth transaction.
From there, I include a bullet list with the descriptions of what I've included like so:
Â· Cover letter
Â· P/S contract
Â· Estimated HUD1
Â· Borrowers Financials
Â· Hardship letter
You certainly do not want a long list taking up the whole page of just bulletins. Make sure you summarize the financial worksheet, paystubs, bank statements and tax returns into Borrowers Financials so it will allow you to include what we're going to cover next.
The information above communicates to the negotiator that we are not amateur investors. The next two paragraphs put the nail in the coffin. Remember again we're not only doing all this to help getting the short sale process started smoothly but also we want what we're going to consider a quick reference guide. Having all this info on the cover letter when we go to pull the file we can quickly look at the first page and instantly remember these things about the property. This will come in handy as your pipeline begins to fill up and you can't remember every little thing about every file you're working.
The first of the two paragraphs will need to be a quick summary of the immediate area around the subject property, usually no more than 2 sentences because remember we're running out of room with all of this on one page. Think of the area and input something like this; The immediate are has XX current bank owned properties and XX currently active short sales of which are either owned or being dealt with by (insert the lender your shorting here) Please help in extraditing this offer into a successful transaction.
We're simply creating a picture for the negotiator hoping that our lowball offer will make more sense because there are so many other problem properties in the immediate are. I've also been known to specify the immediate are, things like; Within a one mile radius, or in the immediate sub-division. Anything I can do to paint that picture and make it seem like it's not just the city or town but it's more focused in on that one little area.
The second paragraph and last paragraph will simply and quickly outline the problems with the property itself. This is where you want to make the lender aware that there is no A/C or that the property has been vandalized etc.. Remember to keep this short and sweet and to the point as well. Not only are we bringing these issues up to the lender but also keeping a record of these for our own quick reference.
The last sentence and hopefully you have room for this after all we've put on the cover letter is a simple thank you for your time. That's it! This letter wasn't our main negotiating tactic or strategy. We're simply showing off our professional skills and having a quick reference guide for ourselves as we move along.
The author has permitted the reprinting and redistribution of this article.