Evaluating a Short Sale Offer
Teamwork Is a Key Ingredient
Short sales are more complex than traditional real estate transactions. They require the participation of all parties involved in order to make the transaction a success, and this is made possible by maintaining open communication lines from the beginning of the process all the way to the end. SSAA listing agents are certified and trained to assist selling agents in managing their buyers’ expectations. When expectations are managed up front, short sale transactions can go more smoothly as each party works together to make the deal successful.
Evaluate Short Sale Offers Carefully
One of the easiest ways for a listing agent to expedite the short sale process is by receiving a clean, accurate, and complete offer from the homebuyer. The ideal short sale offer should include the following items:
- A mortgage pre-qualification letter or proof of funds letter from the buyer
- A statement acknowledging the closing shall occur 30 days after the seller’s receipt of the short sale approval from the lender
- An offer price that falls within 92-100 percent of the current property value
- Signatures, initials and dates on all pages
- No requests for credits for repairs, inspections or testing from the lender, and an acknowledgment that the home is being purchased “as-is”
SSAA Offer Evaluation Form
One of the main reasons listing agents fail at processing short sales is because they send the Servicer purchase contracts that should never have been agreed to by the seller. SSAA agents use a grading system that helps them send only the most qualified purchase contracts to the Servicer, thus increasing the likelihood that their short sales will get approved.
The grading system uses A, B, and C grade-specifiers for each criterion used for assessment. For example, the first section asks them to grade the new contract using the letter grades A, B, or C for the amount of the contract offer as compared to the fair market value (FMV). If the offer is 90% of the FMV or greater, they would score this section as “A.” For 80-90 percent of the FMV, they would grade it as a B, and so forth. SSAA recommends they do not accept contracts that receive any “Cs”.