
1. Hire a Realtor with a record. It’s important to hire a professional, full time Realtor who’s got a track record of successfully selling short sales in Phoenix. Ask for information about their prior successes, but be skeptical of agents who claim to “have a 95% success rate”. Success rate at what? As of winter 2010-2011, only 15% of the short sale homes listed in the MLS actually close. It’s unlikely that any agent has a 95% success rate at closing every attempted short sale. Don’t rely on claims of success: ask for references from past clients and call them for reviews.
2. Get your documents ready early. In order to complete a short sale of your metro Phoenix home, your lender will require copies of tax returns, bank statements, proof of income and other debts, and your “hardship letter” which is a short letter explaining why you’re requesting the short sale. The earlier these things are available, the better. Contact a professional – CPA, attorney and Realtor - for help figuring out what documents you need to attempt a short sale.
3. Know the implications of a short sale of your home. There are tax and credit score consequences of a short sale. Your credit score will sustain some damage: contact a credit non-profit housing counselor or do some online research about managing your credit. The amount of debt forgiven by your lender could be considered taxable income. As of Winter 2010-2011 there are federal waivers in place and the IRS will not treat debt forgiven in a short sale as income. But the writers of this blog are not attorneys or accountants. Please contact your attorney and/or your accountant to find out the tax rules that apply to you now.
Need more help? This blog is run by Chris & Heather, The Phoenix Agents @ Thompson’s Realty. We’re a boutique brokerage of 20 or 30 dedicated, full time professionals. We really do have a good track record at helping homeowners avoid foreclosure by completing a short sale. Give us a call, a text, an email or a Tweet. We’re here to help and look forward to speaking with you about your unique situation.