First off, there are, as always, going to be a lot of money paid out for the foreclosure and the various costs for repairs around the house. Second off, you have to consider wage growth. This means taking a look at something and realizing that the price of it will fluctuate over time. Think of something as simple as a carton of eggs. A few years ago you could buy a dozen for $0.50. Now you are looking at close to $2 for a dozen. The reason? People make more, it costs more to live, etc. The cost of living is always on the rise and real estate is no different. Banks look at this fluctuation and know that in the end it will benefit them. The one reason a lot of people don't like to do short sales is because they think it doesn't really benefit the owner of the home.  However there are many advantages of doing a short sale.  Your credit will only be affected for 2 years vs the 10 years that a foreclosure stays on your credit report.  In addition homeowners are now recieveing $3,000 to help with moving expenses, not to mention they are not evicted, no one is showing up harrassing them to get out.  A short sale is treated as a regular sale and the homeowner stays in the home until the close of escrow allowing them to save money during the short sale approval process. And in only two years you can buy another home instead of renting for 10.

1. Authorization to Release Information. This authorization letter is your written permission for your real estate agent to talk with the lender. 

2. Handwritten hardship letter - This is a personal letter to the lender explaining why you are not able to continue making your mortage payments.  You will need to include your current situation.  Make sure you are to the point, had written and not more than one page.

3. The Listing Agreement.

4. Last two years tax returns. If you did not keep copies of your tax returns you can contact the IRS and they will send it to you, but this can take several weeks.

5. Last two months bank statements.  You can also print your banks statements online or call your bank to have them resend these to you.  Be prepared there may be a small fee associated with mailing them.  Ask your bank about any fees.

6. Last two pay stubs for on all borrowers.  If you are self employed you will need to furnish your last years tax return.

7. Mortgage Statement for all lenders on property

8. Homeowner's financial statement. This is a list of all your expenses and income.  This includes all savings, other real estate owned, credit cards, child support, disability, etc.

If you situation is unique there may be additional documents required such as:

Death Certificate
Divorce Decree
Incarceraton Decree
Bankruptcy LetterProof of Disability
Insurance ClaimsCourt Approvals
HOA Statement

Everyone's situation is unique and the more prepared you are the smoother the process will be.  Every bank works with different guidelines and your real estate agent will help you understand what to be prepared for through the process. 

It is an emotional process, so the better prepared you are - the transaction will go smoother, but the key is to have a certified short sale specialist to know and understand your situation.

Alberto Sotomayor of RE/MAX Champions has received his certification from the Five Star Institute and has completed all the reuirements to achieve his short sale certification.  He also specializes in help those facing short sales and will be happy to answer any questions you may have and he will respect your privacy. 

Alberto Sotomayor is proud and excited to announce that

Homeowners are looking for alternatives to foreclosure, and short sales are becoming increasingly popular. As a short sale specialist, I am qualified and prepared to get the job done! Below are some of the qualifications offer to those facing foreclosure and looking for alternatives. 

•I understand when a short sale is the best option
•I can recognize the steps in the process and develop a short sale package
•Discern what is and is not a hardship
•Negotiate with lenders
•Comply with Home Affordable Foreclosure Alternative (HAFA) rules
•Limit your risk

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.