What goes in a short sale packet?

Listed below is the paperwork required to successfully negotiate a short sale and will be followed by a brief explanation of all the items:

Authorization to Release
Signed Sales Contract
Hardship Letter
2 months of bank statements
2 months of pay stubs
Previous year tax return (W2, 1099)

If anything is missing, the reason must be included in the hardship letter. For example, if the homeowner is self-employed and doesn't receive W2s, it must say in the hardship letter, "I am self-employed and cannot provide W2s".

Authorization to Release
Since you, as an agent, will be speaking to the lending institution on their behalf, you’ll need authorization. An “Authorization to Release” form is a very simple document that states you, as the agent, will be negotiating on behalf of the homeowners. This form should contain the borrower’s name, their Social Security number, date of birth and other relevant information including the address of the home facing foreclosure. Once complete, this document should be faxed to the bank so that you may now negotiate in lieu of the homeowner.

Hardship Letter
This letter should be very thorough, honest and detailed. Explain what has caused this financial hardship (loss of income, divorce, medical). This is the homeowner chance to convince the bank that they have a valid hardship and cannot afford to continue making the payments.