How to Successfully Negotiate a Short Sale

Going through a short sale is not a fun experience, but after successfully negotiating a short sale with Bank of America in 2011, it is well worth the hassle. A few decisions will make the process much easier. First, interview and find a qualified real estate professional. We interviewed four different agents before we found an agent who had successfully negotiated over 100 short sales in the Las Vegas area. While your agent may not have that much experience, make sure that your house is not their first short sale. A qualified agent won't cost you any more, but a weak agent may cost you dearly.

Secondly, buy a scanner. Bank of America, and likely many of the other banks, will flood you with paperwork, I estimate I filled out over 100 documents over a six month period. I decided to scan and file each document in my computer and this saved me countless hours. You will be required to submit several documents and many of them the same ones over a four to eight months period so invest in a scanner.

Third, always be courteous and kind to the Bank of America representative and your real estate agent and transaction coordinator. Remember they are working on your behalf and they really do want you to succeed. Stay positive and expect for the transaction to close.

Next, you will be required to demonstrate a hardship. It is illegal to enter a short sale for strategic default reasons. It is very important to document your hardship whether it be caused from a financial job loss, medical reasons, death or other extenuating circumstances. Using excel I listed out our expenses and income for each month and detailed where every penny was going in the process. While this may seem like overkill, I believe this detail was very helpful in pursuing a positive outcome. You'll also want to pay close attention to your expenses, exotic purchases for vacations, large screen televisions and new vehicles won't bode well in your quest for a short sale approval so do not spend money on any of these items. If you have been putting off medical procedures or immediate needs such as car maintenance due to cash flow shortage, this is a good time to pay for these expenses.

Lastly, don't be surprised if Bank of America declines your first offer to pursue a short sale. We were initially declined for the HAFA program. The HAFA program is a short sale program that will pay the seller up to $3,000 in relocation expenses. Our agent recommended we pursue a traditional short sale, outside of the HAFA program. This is what we did and we were successful.