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Short Sale Negotiations

Short Sale Negotiations are NOT a Dress Rehearsal

While activity on foreclosure cases from years past continues, a stream of new cases are on the horizon, and fighting to save the “American Dream” remains as elusive as ever. However, short sale “approvals” – which offers some homeowners the opportunity to get out from “under” sooner than later – have become a viable option.

In the last few years, homeowners have been introduced to a variety of programs and options – some more desirable than others – that allow them to “cut their losses”.  This is particularly true for properties that are “underwater” (currently worth less than the outstanding loan amount). One such option is a “short sale”. A short sale allows the homeowners to list the property for sale and, if approved by the lender, sell the property for less than the remaining loan balance. The difference between what is owed on the house and what the house is sold for, also known as the “deficiency,” is then totally or partially waived.

For those seeking to get out from under an “underwater” property, a short sale is a logical choice.  But like all things, logical, … only if done right!  Who handles your short sale listing and negotiations matters. Realizing the level of expertise a successful short sale negotiation may require or the “legalities” involved in the process means the attorney and law firm that handles the short sale process can make a world of difference.

Most homeowners do not realize the level of expertise needed to conduct successful short sale negotiations or handle the related legal issues. The spectrum of consequences for a “poor submission” range from a denial of the application to higher than average closing expenses. This then begs the question – who is qualified to assist you in the short sale process? Typically, either the homeowner will try to negotiate the short sale themselves, or they will have a real estate agent or third-party   company handle the transaction. While there are many realtors capable of handling the short sale process, only lawyers will typically be able to spot and handle legal issues, and further, understand the ramifications of a poor agreement. Having a law firm that focuses on short sale negotiations and transactions serves to enhance opportunities for a better result.  After all, short sale negotiations are not a dress rehearsal, …it’s best if you can get it right the first time!

Here are some of the keys to a successful short sale negotiation: First and foremost, let’s begin with the initial application. Typically, it requires requesting a short sale “app” from the lender. The application appears easy on the surface but can be extremely time consuming and labor intensive to prepare. One must know what strategic documents must accompany the application, and more importantly, be aware of what information the lender is looking to obtain.  Second, be prepared to act like a “telephone operator”.  Even the most simple of tasks, such as calling the lender to initiate the short sale process, can be a logistical nightmare. Being transferred from representative to representative and receiving different answers – depending on “who you are speaking with that day” – can be both frustrating and exhausting, even for those with a wealth of experience.  Third, you must be ready to resubmit your documents “routinely”. After the initial submission, lenders require that all financial documents (such as personal bank statements and paystubs) be updated regularly throughout the process.  The benefit of hiring a law firm with a team dedicated to conducting these type of negotiations is that we are able to anticipate these requests and constantly monitor your file to ensure the lender is aware of and reviewing your file for approval. Another “value-added” benefit of working with a law firm is the network and relationships that are generally built-up over time that serve to expeditiously handle and process the transactions promptly.  Many offices, such as ours, work with groups of investors, real estate agents, and lenders, to create a full-service experience from start to finish.  For example, when it comes time to submit an offer to the lender, working with experienced investors and real estate agents allows for well-researched offers to be placed on the property, saving precious time in the contracting and negotiations phase of the short sale process.

Lastly, even with an approval in hand from the lender, one must pay close attention to the convoluted contractual language often used by lenders.  An experienced attorney and law firm will be able to ensure that a homeowner is receiving the “bargained-for” exchange promised by the lender.  This means careful examination of each approval letter, to ensure it contains the most favorable terms for the client’s interest; most importantly – a waiver of deficiency.  While each transaction is unique, and not all clients qualify for a complete waiver of deficiency, this should be the primary goal when conducting a short sale transaction.

The Reyes Law Group helps people aggressively litigate their case, negotiate their loan modification, and/or short-sale transaction because in the end, YOU too deserve a passionate voice to help you fight to defend your property and/or preserve your rights!

Carlos J. Reyes  is the Principal of Reyes Law Group. He has been a member of the Florida Bar since 1988 and practices state-wide.  Carlos has been awarded a rating of “AV Preeminent” which is the highest possible rating in both legal ability and ethical standards by Martindale-Hubbell – a well-recognized legal resource. The RLG Legal Team also include attorneys Stephan LopezMelissa J. UlloaPhillip A. Ortiz and the RLG Legal Support Team to bring you a dedicated, experienced and dynamic legal team to handle your legal needs.

We also assist clients in the areas of: Civil LitigationReal Estate LitigationResidential Purchase & SalesCommercial Acquisitions & SalesResidential Landlord-Tenant LitigationCommercial Landlord-Tenant LitigationShort Sales NegotiationsLoan ModificationsCriminal DefenseCivil Rights ClaimsFamily LawCorporate Work, and Labor & Employment Law.

Call us for a FREE consultation at (954) 369-1993  Se Habla Español.

Visit our firm website ReyesLegal.com and review our credentials.

We are located at 150 S Pine Island Rd #210, Plantation, FL 33324

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The Reyes Law Group BLOG is intended to provide information to firm clients, friends and potential clients about various legal related topics. Nothing in this BLOG should be construed as legal advice or a legal opinion. Readers should not act upon the information contained in this BLOG without seeking the advice of legal counsel.

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Written by Reyes Law Group