Short Sale

GUIDE

What is a Short Sale?

Borrowers who are facing foreclosure may ask the lender to accept a discounted
payoff on their loan. This is called a short sale or short payoff. It allows the
borrower to avoid a foreclosure action, and may offer the lender an expedited and
less costly resolution of the situation.
Historical trends tell us that the number of short sales has increased when
changing markets soften home prices and leave homeowners with a higher
mortgage interest rate or loan balance. For the consumer, negotiating a short sale
with the lender may seem a daunting task, particularly at a stressful time when
foreclosure looms. A short sale allows the borrower to maintain a better overall
credit record than with a foreclosure. It also allows time for the homeowner to
relocate on a more convenient timetable instead of facing eviction and possibly a
deficiency judgment down the road. A short sale may impact the borrowers tax
situation, so a tax advisor should be consulted.
Most lenders have specific criteria to consider a short sale that relate to the
borrowers ability to repay the debt. Some lenders will consider a short sale only
if the borrower can produce evidence of hardship. A property that is distressed
or requires extensive repairs may also qualify. If the lender were to foreclose on
this type of property, it would have to pay for all the repairs necessary to sell the
property. A short sale may represent a more cost-effective way to pay off the loan.
For our team, assisting a homeowner with a short sale means not only a
commission but the real satisfaction that comes from helping someone out of a
tough spot. The benefit to the borrower is that the our team negotiates with the
lender and fields offers from potential buyers as well as collects the necessary
documentation that goes along with the sale.
The tips on the following pages review many of the aspects of a short sale, but
consumers are urged to consult their attorney, HUD homeowner counseling
center, tax professional, and other appropriate professional agencies for assistance.

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Conventional Short Sale Process

First and Second Mortgage

Listing
Appointment

Financial
Qualification

List
Property

Input to MLS

Offer & Execute

Contract

Complete Package
& Send to 2nd

Continue
Marketing

Appraisal of BPO

Re-Negotiate
with Buyer

Approval

Only if Offer Does

not Cover Full
Balance of 1st

Complete Package
& Send to 1st

Submit Letter
of Approval
from 2nd

Not Approved

Appraisal of BPO

Continue
Marketing

Approval

Re-Negotiate
with Buyer

Not Approved

Adjust Payoff
to Title
Update
Contract

Re-Submit

Re-Submit

Final Inspections

Closing

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Update
Contract

Conventional Short Sale Process

Bank Will Communicate

Listing
Appointment

Financial
Qualification

List
Property

Input to MLS

Complete
Package &
Send to Bank

Offer & Execute

Contract

Continue
Marketing

Appraisal or BPO

Approval

Not Approved
Re-

Re-Negotiate
With Buyer

Sub

Adjusted Payoff
to Title

Update Contract

Final Inspection

Closing

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mit

Conventional Short Sale Process

Bank Will Not Communicate

Listing
Appointment

Financial
Qualification

List
Property

Input to MLS

Complete
Package &
Send to Bank

Offer & Execute

Contract

Contract &
Package
Submitted Together

Continue
Marketing

Appraisal or BPO

Approval

Not Approved
Re-

Re-Negotiate
With Buyer

Sub

Adjusted Payoff
to Title

Update Contract

Final Inspection

Closing

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mit

Conventional Short Sale Process

FHA Pre-Foreclosure Sales Program

Listing
Appointment

Financial
Qualification

List
Property

Complete Package
& Send to Bank
(Form 90036 & 38)

FHA Appraisal

Time Runs Out

Gain Acceptance
into Program
(Form 90045)
Submit Request
for Variance
Offer Less than FHA
Appraisal

ue
ntin
Co

Submit Request
for Variance

tin

ke
ar

Offer & Execute

Contract

eM

Submit Request
for Variance

nu

Ma

nti

rke

Co

ting

Input to MLS

Variance Denied

Foreclosure

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Variance Approved

Offer Meets or
Exceeds FHA
Appraisal

Closing

Variance Denied

Variance Approved

Alabama Foreclosure Process

Non-Judicial Foreclosure
is only used when
Power of Sale Cause exists

The Security Instrument

is either a mortgage or a
Deed of Trust

Trustor cannot reinstate

on his defaulted loan

Does not require

court appearance

Notice of Foreclosure to be
published for 4 consecutive
weeks in a county newspaper

30 day waiting period

before sale

Auction takes place,

overseen by lender, in front of
courthouse of county where
property is located

Borrower gets notification of

impending sale by auction

Right of Redemption:
12 months

Deficiency allowed
if granted by judge

Foreclosed home will be sold,

in cash, to the highest bidder

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Deed of Trust depends if it has

Power of Sale Cause

Tips for Avoiding Foreclosure

Free Counseling

For borrowers, foreclosure is a very serious legal procedure which can often be avoided. Housing counseling
agencies sponsored by the United States Government offer valuable resources to help you discover special
borrower programs. Most of these services are free of charge. Contact the US Department of Housing and Urban
Development (HUD) at (800) 569-4287 or visit the departments website at www.hud.gov for more information.

What to Ask the Lender

If you, or someone you know, cannot meet the mortgage payment, HUD recommends that any letters from
the lender be answered immediately with an explanation of the circumstances. Many lenders offer assistance,
but only for those who stay in the home and do not abandon it. For example, the lender may have a special
forbearance program to rearrange payments, or even reduce or suspend them for a period of time. The lender
may also refinance the debt or extend the term of the loan to make the payments lower.
Those with FHA loans may also qualify for a partial claim payment. This program provides a one-time
payment from the FHA Insurance fund to bring the mortgage current. If the loan meets certain criteria, the
lender can file a partial claim. The borrower must sign a Promissory Note and a lien for the amount of the
partial claim that will be placed against the property. The interest-free amount is due and payable when the first
mortgage is paid off or when the property is sold.

Scams

Unfortunately, there are those who prey upon people in financial difficulty. Most likely, anything that sounds too
good to be true probably is. To avoid scams it is important for the borrower to:
Check with a lawyer or the mortgage company before entering into any transaction involving the property.
Remember that the loan must be paid even if the deed is signed over to someone else. The lender must formally
release the mortgage debt.
Make sure all promises are made in writing.
Not sign anything with blanks to be filled in later.
Read and understand all documents before signing.

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Tips for Avoiding Foreclosure

Taxes

In addition to the damage it can do to a borrowers credit rating, foreclosure can also cause major tax
consequences. Most people assume that a foreclosure will automatically cancel taxes, but this is usually not
true. That is why it is important to involve a tax attorney or advisor in all considerations of foreclosure and
alternatives to foreclosure.
Loans against personal property, such as a bank loan or seller carry-back loan to purchase an owner-occupied
residence, are called non-recourse loans. Various state laws protect borrowers from personal liability on a
purchase mortgage for the home they occupy. Under these types of non-recourse loans, the tax liability is
the outstanding amount of the loan, or sales price if higher. A greatly simplified example: The borrower owes
$100,000 on the home he lives in. Even if it is foreclosed upon or given as deed-in-lieu of foreclosure back to
the lender, or the lender accepts a short sale payoff, the borrower is still taxed as if the property had sold for
$100,000.
If the loan is a recourse loan, i.e. the borrower is personally liable if the property is sold for less than the
amount owed to the lender, then the borrower has both personal liability and tax consequences. To obtain a
personal judgment against the borrower, the lender must instigate a judicial foreclosure. The borrower would
be relieved of personal liability if the lender proceeds with a Trustees Sale (or non-judicial foreclosure) on the
property. Again, a foreclosure, deed-in-lieu of foreclosure or short sale all involve a tax obligation which is
computed
as if the property were sold for its value or, in certain cases, if the debt exceeds the propertys value.

The Mega Agent Real Estate Team is There to Help

Another possibility is a pre-foreclosure sale or even a short sale of the property, which avoids the foreclosure
process. Some lenders also allow a deed-in-lieu of foreclosure (also called a friendly foreclosure) in which the
borrower signs the house over to the lender to avoid the foreclosure. This may not be quite as damaging to the
credit rating as a foreclosure, but lenders only consider this option if a pre-foreclosure sale is not possible. The
Mega Agent Real Estate Team can help with these types of sales to avoid foreclosure.

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SHORT SALE VS. FORECLOSURE

Foreclosure vs. Short Sale

ISSUE
ISSUE

FORECLOSURE
FORECLOSURE

SUCCESSFUL
SHORTSALE
SALE
SUCCESSFUL SHORT

Future Fannie Mae Loan

(Primary Residence)1

A homeowner who loses a home to foreclosure is

ineligible for a Fannie Mae-backed mortgage for a
period up to 7 years with some exceptions based on
extenuating circumstances. See: efanniemae.com

A homeowner who successfully negotiates and

closes a short sale will be eligible for a Fannie
Mae-backed mortgage within 2 years (see page
2 for LTV ratios).

Future Fannie Mae Loan

(Non Primary)2

An investor who loses a home to foreclosure is ineligible

for a Fannie Maebacked mortgage for a period up
to 7 years with some exceptions based on extenuating
circumstances. See: efanniemae.com

An investor who successfully negotiates and

closes a short sale will be eligible for a Fannie
Mae-backed investment mortgage within 2 years
(see page two for LTV ratios).

Future Loan with any

Mortgage Company

On any future 1003 application, a prospective borrower

will have to answer YES to question C in Section VIII of
the standard 1003 that asks Have you had property
foreclosed upon or given title or deed-in-lieu thereof in
the last 7 years? This will affect future rates.

There is no similar declaration or question

regarding a short sale.
FHA If current at the close of short sale,
a homeowner may apply for an FHA loan
immediately. If homeowner is late before close
of short sale closing, will be eligible for FHA loan
after 3 years.3

Credit Score

Score may be lowered anywhere from 250 to over 300

points. Typically will affect score for over 3 years.

Only late payments on mortgage will show,

and after sale, mortgage is normally reported
as paid as agreed, paid as negotiated, or
settled. This can lower the score as little as 50
points if all other payments are being made.
A short sales effect can be as brief as 12 to 18
months.

Credit History

Foreclosure will remain as a public record on a persons

credit history for 7 years or more.

A short sale is not reported on a persons credit

history. There is no specific reporting item for
short sale. In most cases a loan is typically
reported paid in full, settled or paid as
negotiated.

Security Clearances

Foreclosure is the most challenging issue against a

security clearance outside of a conviction of a serious
misdemeanor or felony. If a client has a foreclosure and
is a police or security officer, in the military, in the CIA, or
any other position that requires a security clearance, in
almost all cases clearance will be revoked and position
will be terminated.

On its own, a short sale does not challenge most

security clearances.4

Current Employment

Employers have the right and are actively checking the

credit regularly of all employees who are in sensitive
positions. A foreclosure in many cases is ground for
immediate reassignment or termination.

A short sale is not reported on a credit report

and is therefore not a challenge to employment.5

Future Employment

Many employers are requiring credit checks on all job

applicants. A foreclosure is one of the most detrimental
credit items an applicant can have and in most cases
will challenge employment.

A short sale is not reported on a credit report

and is therefore not a challenge to employment.6

Deficiency Judgment

In 100% of foreclosures (except in those states where

there is no deficiency), the bank has the right to pursue
a deficiency judgment.

In some successful short sales it is possible

to convince the lender to give up the right to
pursue a deficiency judgment against the
homeowner.

Deficiency Judgment
(amount)

In a foreclosure the home will have to go through an REO

process if it does not sell at auction. In most cases this
will result in a lower sales price and longer time to sale
in a declining market. This will result in a higher possible
deficiency judgment.

In a properly managed short sale the home is

sold at a price that should be close to market
value and in almost all cases will be better than
an REO sale resulting in a lower deficiency.

If you or someone you know is in

danger of losing thier home to
www.MegaAgents.com
foreclosure,
Contact Me Today!

10

Agent Name!
Address!
Phone!
Email!
Website

SHORT SALE VS. FORECLOSURE

Short Sale vs. Foreclosure

Fannie Mae Waiting Period Table
Fannie Mae Waiting Period Table
Derogatory Event
Derogatory Event
Foreclosure

FannieMae
Mae Waiting
Waiting Period
Fannie
Period
Requirements
Requirements
7 Years

WaitingPeriod
Period with
with Extenuating
Waiting
Extenuating
Circumstances
Circumstances
3 Years
t

t

t

Short Sale

2 Years - 80% maximum LTV ratios

4 Years - 90% maximum LTV ratios
7 Years - LTV ratios per the Lender
Eligibility Matrix

If you or someone you know is in

danger of losing thier home to
foreclosure, Contact Me Today!
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11

Additional requirements after 3

years up to 7 years
90% maximum LTV ratios
Purchase, principal residence

2 Years - 90% maximum LTV ratios

Agent Name!
Address!
Phone!
Email!
Website

Foreclosure Glossary
Absolute Auction: Auction with no minimum bid
amount. The highest bidder wins.

to buyer or a mortgage lien is given to secure debt.

Closing Costs: Expenses involved in closing a real
estate transaction over and above the price of the
land.

Abstract (of title): A history of all transactions

shown in the public records affecting a particular
Acceleration Clause: A provision in a promissory
note that specifies conditions under which the lender
may advance the time when the entire debt which is
secured by the mortgage becomes due.

Clouded Title: A land title having an irregularity,

possible claim or encumbrance that, if valid, would
adversely affect or impair it.
Contract of Sale: Agreement by one person to buy
and another person to sell a specified parcel of land at
a specified price.

Adjustable Rate Mortgage (ARM): Mortgage loans

under which the interest rate is periodically adjusted,
in accordance with some market indicator, to more
closely coincide with the current rates.

Conveyance: The transfer of title or property from

one person to another.

Affidavit: A written statement made under oath

before a notary public or other judicial officer.

Deed: An instrument for conveying real estate.

Default: A failure to meet legal or contractual
obligations.

Agreement: A legally binding contract made

between two or more persons.

Deficiency Judgment: When the proceeds from a

foreclosure sale are less than the amount due on the
debt.

Appraisal: A report from an independent third party

detailing the estimated value of real estate.
Balloon Note/Balloon Payment: A promissory note
with amortization payments scheduled for a long
term, usually 30 years, but maturing in a shorter term,
often five to seven years. It requires a substantial final
balloon payment for the remaining principal.

Encumbrance: Any interest, right, lien or liability

attached to a parcel of land (such as unpaid taxes
or an unsatisfied mortgage) that constitutes or
represents a burden upon the property.
Equity: The current market value of real property,
less the amount of existing liens.

Bankruptcy: A federal court proceeding under the

United States Bankruptcy laws where an insolven
debtor either has its estate liquidated and debt
discharged, or is allowed to reorganize its affairs
under the protection of the bankruptcy court.

Execute: To sign a legal instrument. A deed is said to

be executed when it is signed, sealed, witnessed
Federally-Insured Loan: A mortgage loan that
originates in a federally-insured government
program like the Federal Housing Authority (FHA).

Beneficiary: A person or entity that is legally entitled

by a will, trust or insurance policy to receive money
or property.

Foreclosure: A legal proceeding following a default

by a borrower in which real estate secured by a
mortgage of deed of trust is sold to satisfy the
underlying debt.

Chain of Title: The history of successive ownership

and transfer in the title to a tract of land.
Clear Title: Real property ownership free of liens,
defects and encumbrances or claims.

Instrument: A written document.

Closing (also called Settlement): The completion of

a real estate transfer, where the title passes from seller
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12

Foreclosure Glossary
Judgment: The decision of a court regarding the
rights of parties in an action.

Redemption: The right of the owner in Alabama

to reclaim title to property if he or she pays the
debt to the mortgagee within a stipulated time after
foreclosure. Alabamas Right of Redemption lasts 1
year.

Junior Mortgage: A mortgage lower in lien priority

than another. For example, a second mortgage or
home equity line.

Release: To relieve from debt or security or abandon

a right, such as release of a mortgage lien from a
partor all of the land mortgaged.

Lawsuit: A dispute between two or more parties that

has been filed in the court system by one of them.
Lien: A monetary charge imposed on a property,
usually arising from some debt or obligation.

RESPA: The Real Estate Settlement Procedures

Act (12 U.S.C. 2601 et.seq.) that, together with
Regulation X promulgated pursuant to the Act,
regulates real estate transfers involving a federallyrelated mortgage loan by requiring, among other
things, certain disclosures to borrowers.

Lis Pendens: A recorded legal notice that there is

litigation pending relating to the land, and a warning
that anyone obtaining an interest subsequent to the
date of the notice by be bound by the judgment.
Market Value: The average of the highest price that
a buyer would pay and lowest price a seller would
accept.

Satisfaction: An instrument releasing the lien of a

mortgage.
Senior Lien or Mortgage: If there is more than one
lien on land, those liens are ranked by priority. A
senior lien or mortgage is entitled to be paid first in
foreclosure or bankruptcy, before a junior lien.

Mortgage: A conditioned pledge of property to a

creditor as security for the payment of a debt.
Note (also called a Promissory Note): A written
promise to pay a sum of money, usually at a specified
interest rate, at a stated time to a named payee.

Tenant: One who has right of possession of land by

any kind of title.

Power of Attorney: A written instrument by which

one person, the principal, authorizes another, the
attorney-in-fact, to act on his or her behalf.

Title Defect: Any possible or patent claim or right

outstanding in a chain of title that is adverse to the
claim of ownership.

Principal: A sum of money owed as a debt on which

interest is payable.

Title Insurance Policy: A contract of title insurance

under which the insurer, in keeping with the terms
of the policy, agrees to indemnify the insured against
loss arising from claims against the insured interest.

Public Records: Records which by law disclose

constructive notice of matters relating to the land.

Trustee: Person or entity who is given the legal

authority to manage money or property on behalf of
somebody else. In a foreclosure action, this is often
the title company.

Real Estate (also called Real Property): Land

and anything permanently affixed to the land such
asbuildings, fences, and those things attached to the
buildings, such as plumbing and heating fixtures, or
other such items that would be personal property if
not attached.

Trustor: A person who creates a trust by transferring

property to a trustee. When a borrower signs the
Deed of Trust, the borrower becomes a trustor.

Recording: The noting in a public office of the details

of a legal document, such as a deed or mortgage,
affecting the title to real estate.
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13

Documents

UNIFORM BORROWER ASSISTANCE FORM

If you are experiencing a temporary or long-term hardship and need help, you must complete and submit this form along
with other required documentation to be considered for available solutions. On this page, you must disclose information
about (1) you and your intentions to either keep or transition out of your home; (2) the propertys status; (3) bankruptcy;
and (4) your credit counseling agency.
On Page 2, you must disclose information about all of your income, expenses and assets. Page 2 also lists the required
income documentation that you must submit in support of your request for assistance. Then on Page 3, you must
complete the Hardship Affidavit in which you disclose the nature of your hardship. The Hardship Affidavit informs you of
the required documentation that you must submit in support of your hardship claim.
NOTICE: In addition, when you sign and date this form, you will make important certifications, representations and
agreements, including certifying that all of the information in this Borrower Assistance Form is accurate and truthful
and any identified hardship has contributed to your submission of this request for mortgage relief.
REMINDER: The Borrower Response Package you need to return consists of: (1) this completed, signed and dated
Borrower Assistance Form; (2) completed and signed IRS Form 4506T-EZ (4506T for self-employed borrowers or
borrowers with rental income); (3) required income documentation; and (4) required hardship documentation.
Loan Number __________________________________________________ (usually found on your monthly mortgage statement)
Servicers Name __________________________________________________
I want to:

Keep the Property

Vacate the Property

Sell the Property

The property is currently:

My Primary Residence

A Second Home

An Investment Property

The property is currently:

Owner Occupied

Renter Occupied

Vacant

BORROWER

Undecided

CO-BORROWER

BORROWERS NAME

CO-BORROWERS NAME

SOCIAL SECURITY NUMBER

DATE OF BIRTH

SOCIAL SECURITY NUMBER

DATE OF BIRTH

HOME PHONE NUMBER WITH AREA CODE

HOME PHONE NUMBER WITH AREA CODE

CELL OR WORK NUMBER WITH AREA CODE

CELL OR WORK NUMBER WITH AREA CODE

MAILING ADDRESS

PROPERTY ADDRESS (IF SAME AS MAILING ADDRESS, JUST WRITE SAME)

EMAIL ADDRESS

Is the property listed for sale?

Yes
No
If yes, what was the listing date?
If property has been listed for sale, have you received an offer on the
Yes
No
property?
Date of offer:
mount of Offer: $
Agents Name:
Agents Phone Number:
For Sale by Owner?
Yes
No
Do you have condominium or homeowner association (HOA) fees?
Total monthly amount: $
Have you filed for bankruptcy?
If yes, what is the filing Date:

Have you contacted a credit counseling agency for help?

Yes
No
If yes, please complete the counselor contact information below:
Counselors Name:
Agencys Name:
Counselors Phone Number:
Counselors Email Address:
Yes

No

Name and address that fees are paid to:

Yes

No

If yes:

Chapter 7

Has your bankruptcy been discharged?

Chapter 11
Yes

No

Chapter 12
Bankruptcy case number:

Is any Borrower an active duty service member?

Has any Borrower been deployed away from his/her primary residence or received a Permanent Change of Station order?
Is any Borrower the surviving spouse of a deceased service member who was on active duty at the time of death?

Fannie Mae/Freddie Mac Form 710

Page 1 of 4

Chapter 13

Yes
Yes
Yes

No
No
No

February 2013

UNIFORM BORROWER ASSISTANCE FORM

Monthly Household Income

Monthly Household Expenses and Debt Household Assets (associated with the
Payments
property and/or borrower(s)excluding
retirement funds)

Gross wages

First Mortgage Payment

Checking Account(s)

Overtime

Second Mortgage Payment

Checking Account(s)

Child Support / Alimony*

Homeowners Insurance

Savings / Money Market

Non-taxable social security/SSDI

Property Taxes

CDs

Taxable SS benefits or other monthly

Credit Cards / Installment Loan(s) (total $

Stocks / Bonds

income from annuities or retirement

minimum payment per month)

plans
Tips, commissions, bonus and self-

Alimony, child support payments

Other Cash on Hand

Rents Received

Car Lease Payments

Other Real Estate (estimated value)

Unemployment Income

HOA/Condo Fees/Property Maintenance $

Other

Food Stamps/Welfare

Mortgage Payments on other properties $

Other

Other

Total (Gross income)

Total Household Expenses and Debt

employed income

Total Assets

Payments

Any other liens (mortgage liens, mechanics liens, tax liens, etc.)
Lien Holders Name

Balance and Interest Rate

Loan Number

Lien Holders Phone Number

Required Income Documentation

Do you earn a salary or hourly wage?
For each borrower who is a salaried employee or
paid by the hour, include paystub(s) reflecting the
most recent 30 days earnings and documentation
reflecting year-to-date earnings, if not reported
on the paystubs (e.g. signed letter or printout
from employer).

Are you self-employed?

For each borrower who receives self-employed income, include a complete, signed
individual federal income tax return and, as applicable, the business tax return; AND
either the most recent signed and dated quarterly or year-to-date profit/loss statement
that reflects activity for the most recent three months; OR copies of bank statements for
the business account for the last two months evidencing continuation of business
activity.

Do you have any additional sources of income? Provide for each borrower as applicable:
Other Earned Income such as bonuses, commissions, housing allowance, tips, or overtime:
Reliable third-party documentation describing the amount and nature of the income (e.g., paystub, employment contract or printouts
documenting tip income).
Social Security, disability or death benefits, pension, public assistance, or adoption assistance:
Documentation showing the amount and frequency of the benefits, such as letters, exhibits, disability policy or benefits statement from the
provider, and
Documentation showing the receipt of payment, such as copies of the two most recent bank statements showing deposit amounts.
Rental income:
Copy of the most recent filed federal tax return with all schedules, including Schedule ESupplement Income and Loss. Rental income for
qualifying purposes will be 75% of the gross rent you reported reduced by the monthly debt service on the property, if applicable; or
If rental income is not reported on Schedule E Supplemental Income and Loss, provide a copy of the current lease agreement with either
bank statements or cancelled rent checks demonstrating receipt of rent.
Investment income:
Copies of the two most recent investment statements or bank statements supporting receipt of this income.
Alimony, child support, or separation maintenance payments as qualifying income:*
Copy of divorce decree, separation agreement, or other written legal agreement filed with a court, or court decree that states the amount
of the alimony, child support, or separation maintenance payments and the period of time over which the payments will be received, and
Copies of your two most recent bank statements or other third-party documents showing receipt of payment.
*Notice: Alimony, child support, or separate maintenance income need not be revealed if you do not choose to have it considered for repaying
this loan.

Fannie Mae/Freddie Mac Form 710

Page 2 of 4

February 2013

UNIFORM BORROWER ASSISTANCE FORM

HARDSHIP AFFIDAVIT
I am requesting review of my current financial situation to determine whether I qualify for temporary or permanent mortgage loan relief
options.
Date Hardship Began is:
I believe that my situation is:
Short-term (under 6 months)
Medium-term (6 12 months)
Long-term or Permanent Hardship (greater than 12 months)

I am having difficulty making my monthly payment because of reason set forth below:
(Please check the primary reason and submit required documentation demonstrating your primary hardship)

If Your Hardship is:

Unemployment
Reduction in Income: a hardship that
has caused a decrease in your income
due to circumstances outside your
control (e.g., elimination of overtime,
reduction in regular working hours, a
reduction in base pay)
Increase in Housing Expenses: a
hardship that has caused an increase in
your housing expenses due to
circumstances outside your control
Divorce or legal separation; Separation
of Borrowers unrelated by marriage,
civil union or similar domestic
partnership under applicable law

Death of a borrower or death of either

the primary or secondary wage earner
in the household
Long-term or permanent disability;
Serious illness of a borrower/coborrower or dependent family member

Then the Required Hardship Documentation is:

No hardship documentation required
No hardship documentation required

No hardship documentation required

Divorce decree signed by the court; OR

Separation agreement signed by the court; OR
Current credit report evidencing divorce, separation, or non-occupying
borrower has a different address; OR
Recorded quitclaim deed evidencing that the non-occupying Borrower or coBorrower has relinquished all rights to the property
Death certificate; OR
Obituary or newspaper article reporting the death

Proof of monthly insurance benefits or government assistance (if applicable); OR

Written statement or other documentation verifying disability or illness; OR
Doctors certificate of illness or disability; OR
Medical bills
None of the above shall require providing detailed medical information.
Disaster (natural or man-made)
Insurance claim; OR
Federal Emergency Management Agency grant or Small Business Administration
adversely impacting the property or
loan; OR
Borrowers place of employment
Borrower or Employer property located in a federally declared disaster area
Distant employment transfer / Relocation For active duty service members: Notice of Permanent Change of Station (PCS) or
actual PCS orders.
For employment transfers/new employment:
Copy of signed offer letter or notice from employer showing transfer to a new
employment location; OR
Pay stub from new employer; OR
If none of these apply, provide written explanation
In addition to the above, documentation that reflects the amount of any relocation
assistance provided, if applicable (not required for those with PCS orders).
Business Failure
Tax return from the previous year (including all schedules) AND
Proof of business failure supported by one of the following:
Bankruptcy filing for the business; OR
Two months recent bank statements for the business account evidencing
cessation of business activity; OR
Most recent signed and dated quarterly or year-to-date profit and loss
statement
Other: a hardship that is not covered
Written explanation describing the details of the hardship and relevant
above
documentation

Fannie Mae/Freddie Mac Form 710

Page 3 of 4

February 2013

Borrower/Co-Borrower Acknowledgement and Agreement

I certify, acknowledge, and agree to the following:
1. All of the information in this Borrower Assistance Form is truthful and the hardship that I have identified
contributed to my need for mortgage relief.
2. The accuracy of my statements may be reviewed by the Servicer, owner or guarantor of my mortgage, their
agent(s), or an authorized third party*, and I may be required to provide additional supporting documentation.
I will provide all requested documents and will respond timely to all Servicer, or authorized third party*,
communications.
3. Knowingly submitting false information may violate Federal and other applicable law.
4. If I have intentionally defaulted on my existing mortgage, engaged in fraud or misrepresented any fact(s) in
connection with this request for mortgage relief or if I do not provide all required documentation, the Servicer
may cancel any mortgage relief granted and may pursue foreclosure on my home and/or pursue any available
legal remedies.
5. The Servicer is not obligated to offer me assistance based solely on the representations in this document or
other documentation submitted in connection with my request.
6. I may be eligible for a trial period plan, repayment plan, or forbearance plan. If I am eligible for one of these
plans, I agree that:
a. All the terms of this Acknowledgment and Agreement are incorporated into such plan by reference as
if set forth in such plan in full.
b. My first timely payment under the plan will serve as acceptance of the terms set forth in the notice of
the plan sent by the Servicer.
c. The Servicers acceptance of any payments under the plan will not be a waiver of any acceleration of
my loan or foreclosure action that has occurred and will not cure my default unless such payments are
sufficient to completely cure my entire default under my loan.
d. Payments due under a trial period plan for a modification will contain escrow amounts. If I was not
previously required to pay escrow amounts, and my trial period plan contains escrow amounts, I agree
to the establishment of an escrow account and agree that any prior waiver is revoked. Payments due
under a repayment plan or forbearance plan may or may not contain escrow amounts. If I was not
previously required to pay escrow amounts and my repayment plan or forbearance plan contains
escrow amounts, I agree to the establishment of an escrow account and agree that any prior escrow
waiver is revoked.
7. A condemnation notice has not been issued for the property.
8. The Servicer or authorized third party* will obtain a current credit report on all borrowers obligated on the
Note.
9. The Servicer or authorized third party* will collect and record personal information that I submit in this
Borrower Response Package and during the evaluation process. This personal information may include, but is
not limited to: (a) my name, address, telephone number, (b) my social security number, (c) my credit score, (d)
my income, and (e) my payment history and information about my account balances and activity. I understand
and consent to the Servicer or authorized third party*, as well as any investor or guarantor (such as Fannie
Mae or Freddie Mac), disclosing my personal information and the terms of any relief or foreclosure alternative
that I receive to the following:
a. Any investor, insurer, guarantor, or servicer that owns, insures, guarantees, or services my first lien or
subordinate lien (if applicable) mortgage loan(s) or any companies that perform support services to
them; and
b. The U.S. Department of Treasury, Fannie Mae and Freddie Mac, in conjunction with their
responsibilities under the Making Home Affordable program, or any companies that perform support
services to them.
10. I consent to being contacted concerning this request for mortgage assistance at any telephone number,
including mobile telephone number, or email address I have provided to the Lender/Servicer/ or authorized
third party*. By checking this box, I also consent to being contacted by text messaging.
_________________________________ __________ ___________________________ __________
Borrower Signature
Date
Co-Borrower Signature
Date
*An authorized third party may include, but is not limited to, a counseling agency, Housing Finance Agency (HFA) or
other similar entity that is assisting me in obtaining a foreclosure prevention alternative.
Fannie Mae/Freddie Mac Form 710

Page 4 of 4

February 2013

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Authorization To Release Information

This release will be used for the purpose of facilitating and expediting the transaction contemplated by the listing agreement
between the undersigned and
. It will be used to obtain personal
and financial information of the undersigned. The authorized parties listed below shall use all reasonable means to ensure the
information provided is used for the purposes set out below. The parties listed below shall not be liable and shall be held harmless
from and for any claims of loss or damage caused in connection with the use of this authorization. I hereby authorize

(205) 991-1500
991-1500
RE/MAXAdvantage
Advantage
of RE/MAX
(whose phone number is (205)
Collier Swecker & Dianne Daniels
(205)
267-1519
and fax number is (205) 267-1519
) and/or any designated agent, assistant, Title Company or its agents to verify any

Collier Swecker & Dianne Daniels

and all information pertaining to the mortgage or property detailed below and any additional financial information pertaining to
this property, including homeowners association, taxes, liens, and any other encumbrances.

I/We,
hereby release,
its affiliates,
employees, agents, and directors from any claims that might arise in connection with this authorization. This authorization shall
remain in effect until revoked in writing and a copy of such revocation is provided to all parties listed above. It is understood a
photocopy or fax of this form will also serve as authorization.
PROPERTY:
Property Address: __________________________________________________________________ City: _______________________________________________________ State: __________ Zip: _____________

1ST MORTGAGE:
Mortgage Company: ______________________________________________________________ Account Number: ____________________________________________________________________________
Phone Number: ____________________________________________________________________ Fax Number: _________________________________________________________________________________
Address: ___________________________________________________________________________ City: _______________________________________________________ State: __________ Zip: _____________
Loss Mitigation Contact: ___________________________________________________________ Direct Number: __________________________E-mail Address: _____________________________________

2ND MORTGAGE:
Mortgage Company: ______________________________________________________________ Account Number: ____________________________________________________________________________
Phone Number: ____________________________________________________________________ Fax Number: _________________________________________________________________________________
Address: ___________________________________________________________________________ City: _______________________________________________________ State: __________ Zip: _____________
Loss Mitigation Contact: ___________________________________________________________ Direct Number: __________________________E-mail Address: _____________________________________

ASSOCIATION (IF ANY):

Management Company: __________________________________________________________ Account Number: ____________________________________________________________________________
Phone Number: ____________________________________________________________________ Fax Number: _________________________________________________________________________________
Contact:___________________________________________________________________________ Direct Number: __________________________E-mail Address: _____________________________________

AUTHORIZED BY:
Borrower Signature: ________________________________________________________________ Social Security Number: ___________________________________ Date of Birth: _____________________
Printed Name: _________________________________________________________________________________________________________________________________ Date: _____________________________
Co-Borrower Signature: ____________________________________________________________ Social Security Number: ___________________________________ Date of Birth: _____________________
Printed Name: _________________________________________________________________________________________________________________________________ Date: _____________________________
Reserved for Notary

LISTING AGENT/BROKER:
Agent/Broker signature:____________________________________________________________
Agent/Broker signature: __________________________________________

NOTARY (OPTIONAL):
Notary Signature: __________________________________________________________________
Notary Printed Name: ______________________________________________________________

FORM AGENERAL
2011 Distressed Property Institute, LLC. All rights reserved. Any duplication without express written consent is prohibited. All CDPE forms are provided for informational purposes only. The Distressed Property Institute, LLC assumes no
responsibility nor guarantees the accuracy of these forms. It is strongly recommended that agents investigate the specific items necessary to their situation and local and regional laws. 11.12.RS

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Short Sale Disclosure

RE/MAX Advantage

Collier Swecker

Brokerage

Listing Agent

Property Address

Seller

Buyer

This disclosure will serve as an independent agreement and relates to the contract executed by the buyer and seller
named above. It is expressly understood by all parties that the seller owes more than the amount of the contract and is
unable to bring cash to closing, therefore the sale will require the approval of the lender. Please note that the property
may remain on the market for the purpose of accepting backup offers until the lender approves a contract, and the
property will be listed on MLS as undergoing a short sale.
Following are some potential issues that can affect a short sale:
1. After the lender receives the short sale packet, the lender may require at least 60-90 business days to approve the
short sale. After approval, the sale must close within lender approved time frame, typically 30-45 calendar days.
2. The seller will receive no cash from this transaction (unless the short sale is HAFA-approved). Any funds usually due to
the seller will be paid to the lender.
3. The seller has no additional cash and will be unable to pay for any closing costs, such as the termite bond, buyers
appraisal or home warranty. Should the buyer desire a home warranty or termite bond they are free to purchase one
at closing.
4. The seller may be unable to pay for maintaining the property. The property will remain in the current condition
through closing; the seller will not be able to make any repairs to the property.
5. The sellers broker will pay the the buyers broker a commission equal to the amount listed in the MLS. Please
note that since the lender is taking less than what is owed to them in a short sale, the lender in some cases may
negotiate a lower commission percentage.
6. Any offer on this short sale must include a pre approval letter from Buyer's Lender if 3rd party financing is being
accomplished. If the offer is cash the Seller's Lender will require a "proof of funds" letter.
7. Buyer will be granted a 7 business day inspection period. There inspection period shall commence once the Buyer's
Agent receives written notification from the Listing Agent that the short sale file has been approved by the Seller's Lender.
During the inspection period, Buyer may terminate the contract for any reason and any earnest monies will be released
back to the Buyer.
8. The sellers forgiven or cancelled debt may be taxable income. The seller should discuss this matter with a tax
professional. This has no bearing whatsoever on the buyer.
9. In some cases the lender may pursue a deficiency judgment against the seller for any funds not collected at closing.
This has no bearing whatsoever on the buyer.
10. By signing this disclosure, you acknowledge that you have read and understand these situations. Any changes to the
commission rate will be provided by the lender at the time of the lenders final approval of this short sale.

Sellers Signature

Date

Buyers Signature

Date

Sellers Signature

Date

Buyers Signature

Date

Listing Brokers Signature

Date

Selling Brokers Signature

Date

Listing Brokerage/Company

Date

Selling Brokerage/Company

Date

Listing Agent

Date

Selling Agent

Date

RE/MAX Advantage

FORM P
2010 Distressed Property Institute, LLC. All rights reserved. Any duplication without express written consent is prohibited. All CDPE forms are provided for informational purposes only. The Distressed Property Institute, LLC assumes no
responsibility nor guarantees the accuracy of these forms. It is strongly recommended that agents investigate the specific items necessary to their situation and local and regional laws. 10.1.10

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