Short Sales in Minnesota

There are a lot of misleading information on how short sales work and the seller’s role in the process.

When a property is being sold, the seller is in control of the process (listed and marketed for sale). For a property to be sold as a short sale, the seller needs to be qualified by proving hardship that has been in result of or will be a result of missing payments. Lenders will require the seller to be 30 days behind payment. After 6 months of missed payment, most lender will sell the property as a foreclosure, in which afterwards the lender will not negotiate a short sale…so the seller needs to act quickly.

When offers come in for the home, the seller will review all offers. All the offer terms will be reviewed with the seller and at this time, it’s up to the seller and the agent to decide on accepting, countering or rejecting the purchase agreement so that it meets your best interests.

Usually the agent will try to obtain an offer within the first 30 days, so the agent will require that the seller has all of the documentation together that the lender will need to approve the short sale application.

Once the offer and short sale application have been submitted the agent will work with the lender to negotiate the best short sale terms possible to eliminate the need for the seller to bring cash to closing or sign promissory notes. The lender will send a short sale approval letter and if the terms are acceptable, the seller will move forward closing the property.

The seller will need to sign legal documents to transfer ownership of the short sale property and the title company will make arrangements for the closing agent to pre-sign all documents.

Generally the closing costs and commissions will be paid out of the sale proceeds with lender approval.