By Meredith, Executive Assistant
Agents and sellers alike are often daunted by the ins and outs of the short sale process. Collecting documents, communicating with the bank, negotiating with an investor, all while knowing that a family may face foreclosure in the near future – it is a stressful prospect. Licensed short sale negotiators such as LMS Law LCC are happy to use their experience and knowledge to your advantage. But what is it that these negotiators actually do? In this four-part series, we’ll take a long look at short sales and what actually happens at the banks when the documents are submitted.
Part IV: The Long and Winding Road to Settlement
Your short sale has been approved – how exciting!
Now, it’s time to settle, time to change the locks and call the moving company!
When the bank issues the approval, there are a few final steps to complete prior to settlement.
Your short sale negotiator will notify you of the approval and its terms, and reviews the approvals to make sure they are in line with each other. The title company does a final lien review to ensure that the title is clear prior to settlement, and the buyer completes his inspection and finalizes his financing.
Many banks will issue an extension of approval, if there is a compelling reason to do so. Unexpected liens, delays with buyer financing, and other justifications usually result in an extension of the approval. However, an approval is not guaranteed – your short sale negotiator can assist you through this process.
Generally, the period between approval and settlement is devoted to getting all of the short sale ducks in a row so that settlement can proceed smoothly. When all parties are ready to close, the banks request a final HUD-1 for review, usually two to three business days prior to the desired settlement date. The closing officer confirms that the final HUD-1 is in line with the approval letters, and issues an approved final HUD-1 and closing instructions.
After settlement has been completed, the bank usually requests a copy of the completed closing documents. Some lenders will also discuss any promissory notes or other special repayments after settlement.
The short sale process can be a daunting and confusing one, but a skilled, experienced negotiator can provide peace of mind and advice to assist you. LMS Law LLC is proud to have successfully negotiated thousands of short sales, and would welcome the opportunity to help you with yours.