The 5 Steps

to Listing a Successful Short Sale

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Dont miss out on the greatest
opportunity available in todays market.
The 5 Steps
to Listing a Successful Short Sale
Agents often tell us that they refuse to list short sales.
Many have tried, unsuccessfully, to negotiate short sale transactions in the past and swore off trying again. Others
dont want to invest the time to learn what they believe is a niche specialty. Some are agents who have successfully
closed short sales, but it was such a painful process, they have avoided taking on another.
Unfortunately, if you are one of these agents, you are missing out on the greatest opportunity available in todays
market.
Currently, 1 in 7 homeowners are not ayinq their mortqaqe.
The national unemloyment rate is over O%.
The number ol short sales has more than triled since 2OO8.
The short sale market is no lonqer a niche. Any aqent who wants to survive and thrive today must master the short
sale process.
The challenqe most aqents have with short sales is they start the rocess once they have a urchase and sale
contract. This will cause you a tremendous amount ol stress, lrustration and heartache!
The lollowinq system has heled tens ol thousands ol Certiled Bistressed Froerty Exert (CBFE) desiqnated aqents.
Comlete 4x as many transactions as the averaqe real estate aqent
Reduce their short sale rocessinq time by u to 5O%
Close more than 7 short sale transactions in the last 12 months
Step 1: Complete 80% of the Paperwork at the First Meeting
n a short sale situation, it is critical that you review and qet the seller to siqn the lollowinq lorms.
1. Siqnature Authori/ation - Recommended lor all transactions (distressed or not), this should be sent to
the mortgage company immediately after the listing appointment.
2. Short Sale Bisclosure - n a short sale situation, this is mandatory.
3. Hold Harmless In a short sale situation, this is also mandatory.
4. homeowner Froerty Checklist - Remember, the roerty has to sell. nclude suqqestions lor qettinq the
roerty reared on the homeowner Froerty Checklist.
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5. homeowner Bocument Checklist - Belore you leave your clients' roerty, you need to leave them with a
list ol documents they will need to have ready lor you. The documents need to be current, meaninq il you
list in January and dont have an offer to negotiate until April, you will need documents for the time period
immediately recedinq the oller, not the listinq (February and March).
6. homeowner Financial worksheet - This lorm is what lenders use to determine whether or not your seller
can ay their mortqaqe, so be sure that it is comlete and that it shows a delcit.
7. Listinq Addendum - Bo not list a distressed roerty lor less than seven months, and secily scheduled
price changes in your listing agreement.
8. hardshi Letter - This exlains to the lender what has haened to cause your client to be unable to
continue making mortgage payments.
hote. All ol these lorms are available online lor CBFEs in the Member Resources area.
Step 2: Short Sale Pricing Strategy
Fricinq a short sale, and the subsequent ricinq reductions, are the most imortant lactors in qettinq a contract and
havinq your short sale aroved. The reality is, the short sale robably needs to be the lowest comarable roerty
in the neighborhood in order for a buyer and buyers agent to cooperate. Additionally, in the case of a short sale, the
buyers agent needs to be enticed to not only show the property, but to cooperate with the process.
l you are a CBFEdesiqnated aqent, we recommend you use the CBFE Listinq Frice worksheet included in your
Member Resources. You can also create your own lorm. You will need to consider.
1. Fair market value
2. Time lelt belore loreclosure or reloreclosure
8. Bays on market
4. Froerty condition
5. Amount owed on the roerty
Step 3: Take Pictures, Two Sets
when you are at your initial aointment with a short sale seller, you need to take hotos the same way you would
with any other listing, only you need to take two sets.
The lrst set ol ictures are the ones you would normally take lor marketinq. lront ol the house, back yard, kitchen,
livinq area, bathrooms, etc. The second set should include secilc ictures ol any damaqe the roerty has or reairs
that it needs. These should be as detailed as ossible. use the CBFE Fhoto Loq, or take notes, to hel you remember
the damage you have photographed.
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Step 4: Damage and Repairs, Record the Details
As you take ictures ol the roerty, comlete the CBFE Reairs and Bamaqe Form, or record the inlormation on your
own. This will be very valuable to you later when it comes to neqotiatinq with the bank. You also don't want to have
to make reeated, unnecessary tris to the roerty, so we want you to accomlish as much as ossible on the lrst
visit. Go room by room and note everything.
Step 5: Initial Title/Lien Search
we recommend you have an initial title search done on every distressed (or otherwise) roerty you list. For a short
sale, this is esecially imortant, because il you have liens, lnes, code violations or other clouds on the title, you need
to see if they can be removed or negotiated immediately. In many cases, you should not pursue a sale.
Lien Negotiation
If there are any liens found after your title search, you should immediately call the person or company with the lien
to see il they will neqotiate a reduction with you. Remember, in a loreclosure situation, lienholders aqainst a roerty
usually qet absolutely nothinq alter a loreclosure. There is a very qood chance that you can neqotiate so that the
lienholder gets something rather than nothing. If you do negotiate a reduction in lien, get a letter from the lienholder
lor the amount they are willinq to accet. You will need this lor the title comany at closinq.
Another tactic is to have the homeowner sign a note for a portion of the lien so that it can be removed from the
property and placed on your client personally. In all cases with a short sale, you and your client need to do whatever
possible to reduce all liens prior to package submission.
IRS or Federal Tax Liens
Federal tax liens are all at once recorded aqainst an individual and any roerties he or she owns. l your seller has a
lederal tax lien recorded aqainst him or her, this lien jums ahead ol all other liens that are on the roerty. however,
it may not have to be aid oll in order lor a short sale to qo throuqh. Your client can work with an RS aqent or
investiqator (il a client has tax liens, chances are they have a ersonal contact) to try to qet a "subordination ol lien"
so that the qovernment will allow the short sale to qo throuqh. The RS rocessors will want to see that the roerty
is beinq sold with no qain to the seller and that it is an arm's lenqth transaction. The RS will require a detailed letter
ol exlanation, alonq with a reliminary huB statement that shows no roceeds to the seller in order to qive aroval.
This is a rocess that your client should start immediately when you list the roerty.
These subordinations are usually handled by a secial deartment and not by your client's investiqator. Make certain that
your client beqins this rocess immediately and is in the rocess ol qettinq an authori/ation to subordinate as quickly as
ossible. This way he or she knows exactly where to send a dralt to huB immediately when you receive an oller.
visit the RS website at htt.//www.irs.qov to lnd inlormation on.
hotices ol lederal tax lien Releasinq a lien
Fayoll amounts Alyinq lor a discharqe ol a lederal tax lien
Makinq the RS lien secondary withdrawinq liens

Lien enquiries Aealinq the llinq ol a lien
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how that you have comleted these lve stes, you are ready to list the roerty. But listinq is just the lrst hase. The
CBFE Besiqnation course will teach you everythinq you need to know to list, submit a roosal, neqotiate, and close
short sale transactions.
Eighty percent of homeowners in distress say their rst call would be to a real estate agent
Will you know what to do when a homeowner calls you looking for help?
Stop missing out, and start proting
from the opportunities in your market
to help homeowners avoid foreclosure!
Visit www.cdpe.com
or call 1-800-482-0335
to learn more about becoming a CDPE and to register for a
CDPE Live training event or our online Distance Learning course.