Who Pays the Commission on a Short Sale

On February 1, 2012 By

A common question.  I’ll do my best to answer it for you.

When a real estate transaction closes, there is a document created called a HUD-1 Settlement Statement.  The HUD-1 is a spreadsheet of sorts that outlines the flow of money for the two parties involved in the transaction.

Who are the two parties?  The buyer [...]

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Short Sale Cash Contributions at Closing

On January 13, 2012 By

On many short sales, there’s a point at which the bank will tell us that the seller is required to come to the table with cash or a promise to sign a note for a certain amount of money.

In a specific example, a home owner has been told that they are on the verge [...]

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Short Sale Basics Part Five: The Gap and Closing the Gap

On December 28, 2011 By

(This is the final article of a 5 part series entitled Short Sale Basics)

The Gap

If the net payoff on a given HUD-1 for the sale of a home does not meet the standards set by the investor as a percentage of the BPO (Broker Price Opinion) then there will be a gap.  For example, [...]

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Who Can Afford A Down Payment?

On December 27, 2011 By

As I’m reading through the latest predictions for the upcoming market conditions, I’m taken aback by one of the statements.  In an article written by Jed Kolko, Chief Economist for Trulia.com entitled What the Cyrstal Ball Says about the housing market in 2012, he points out the probability of rental rates increasing, and that it [...]

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Short Sale Basics Part Four: The BPO

On December 24, 2011 By

(This is part 4 of 5 of the short series entitled Short Sale Basics)

The BPO

The BPO is that 3rd party opinion of value.  It can make or break the deal because banks look at this number as the letter of the law when it comes to your home’s value during a short sale negotiation. [...]

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Short Sale Basics Part Three: The Net Payoff

On December 20, 2011 By

(This is part 3 of 5 of the short series entitled Short Sale Basics)

The Net Payoff

Let’s assume that the house you’re about to sell receives an offer of $100,000 and you owe $200,000.  I can’t stress this enough.  For the purposes of obtaining an approval from the lender, the deficiency DOES NOT MATTER.  The [...]

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Short Sale Basics Part Two: The Offer

On December 16, 2011 By

(This is part 2 of 5 of the short series entitled Short Sale Basics)

The Offer

When a house goes on the market and someone makes an offer, if that offer is less than the seller owes on their mortgage, then you have a problem.  You have a short sale.  You are going to need to [...]

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Short Sale Basics Part One: Market Value

On December 13, 2011 By

(This is part 1 of 5 of the short series entitled Short Sale Basics)

At its core, a short sale is a standard real estate transaction.  A house is listed for sale at a price comparable to the surrounding market activity, including sold properties, competing properties for sale, and properties under contract.  A buyer makes [...]

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