Selling your home as a short sale can never be an easy decision, but in most cases it is a far better alternative than foreclosure.  To successfully sell your home as a short sale, there are a few vital steps that you should prepare for. 

1)  DO YOUR RESEARCH.   If you are upside down on your mortgage, you have a valid financial hardship, and you need to sell, a short sale may be your best choice.  The first step to starting this process is to find a real estate agent that is experienced in closing short sales.  When you are interviewing agents, ask, “how many short sale transactions have you successfully closed?”  Many agents claim to be experts; it will serve you best to select one that truly is a short sale specialist with experience in closing deals.

2)  GET STARTED.  The longer that you wait to get the short sale process started, the more obstacles will have to be overcome.  The short sale process can be lengthy and if you are facing a foreclosure date, will be much more complicated.  Do not wait until it is to late.   As soon as you realize that you can no longer afford your home and need to sell, start to interview real estate agents.  (One of the most frustrating thing that I deal with in my real estate sales career is meeting people that are facing imminent foreclosure or have just recently lost their home that ask me if they have options – the truth is, in most cases they could of avoided their dire situation if we had talked months ago, but now it is to late).

3)  KNOW YOUR TAX RESPONSIBILITY.  As I am not an accountant, I will not consult on tax matters, but suggest that you do your due diligence about your potential tax burden.  Check the IRS website and speak with your accountant to get guidance. 

4)  LISTEN TO YOUR REAL ESTATE AGENT.  If you have done a good job in selecting a qualified real estate agent to represent you, they will have the experience to successfully guide you through this process.  Understand that a short sale is not the same as a traditional sale and there will be things unique to your situation that your real estate agent will guide you through.  Various paper work will be required; when you applied for your loan, you needed documents such as pay stubs, tax returns, etc – essentially, you are now unapplying for the loan and will need the same documents that you originally needed.  Acknowledge that your home is not worth what you bought it for.  It will have to be priced to the market – not to what it was worth in 2006.  Again, your agent will guided you through the proper pricing.

5)  PREPARE FOR TURBULENCE.  Selling your home as a short sale can be a difficult experience.  Understand that you will get frustrated at some point during the transaction.  A great real estate agent will properly and consistently communicate with you during the process even if there has been no new news to update.  Prepare for an emotional journey and understand that if you hired correctly, you have an expert that will guide you through to the end.

My sales team has closed numerous successful short sales in Virginia, Maryland, and DC.  Through our experience and through national media exposure with venues such as NBC Nightly News with Brian Williams, The Today Show, The Washington Post, and many more featuring our short sale success, we have met short sale experts across the country.  Contact me, Dan Rochon at Dan@GreetingsVirginia.com  if you would like a referral to a short sale expert in your area.  Best of luck!!