This presentation outlines the major process, qualifications and requirements for a short sale.

1. Helping You To Preserve Your Credit ShortSaleCanStopForeclosure.com A Guide To Understanding The Process

2. Helping You To Preserve Your Credit What Is A Short Sale? It’s a Real Estate transaction where two unique events MUST occur together. 1. Sale of your home results in a net loss A short sale occurs when the net proceeds from the sale of your home is not enough to cover your mortgage note balance. 2. Lender Agreement The lender (or lenders) agrees to release its mortgage lien and note obligations on the home in exchange for payment less than the full loan balance. ShortSaleCanStopForeclosure.com

4. Title fees associated with closing of property

5. Holding the property until a successful resale (toxic asset for Banks)

6. Maintain property, pay property taxes, winterize, pay utilities

7. Commissions & marketing costs of resale, if it sales ShortSaleCanStopForeclosure.com

9. Seller can document financial hardship

10. Seller has a firm sale which generates insufficient proceeds

11. Seller receives no cash or other benefits from sale of property

12. Seller proves current market comparables support sale price ShortSaleCanStopForeclosure.com

13. Helping You To Preserve Your Credit Why Would A Seller Want To Do A Short Sale? Potential Seller Benefits The Government recently passed HAFA (Home Affordable Foreclosure Alternatives) to facilitate the short sale process for homeowners underwater. With HAFA, the Government requires that homeowners are released from their debt, and any future liability from their Lender. Financial Incentives are provided: $3000 for you, $1000 for the Lenders, and up to $3000 for any additional lien holders. The process has been streamlined, and is MUCH faster now than ever before. ShortSaleCanStopForeclosure.com

14. Helping You To Preserve Your Credit Why Would A Seller Agree To A Short Sale? Continued….. 5. A Short Sales has less impact on your credit rating than a Foreclosure or Deed-In-Lieu of Foreclosure. 6. Your lender may stop reporting missed payments to credit agencies. 7. Provides more time for you to act are prepare in this difficult situation. 8. You may buy another home sooner as compared to a foreclosure. ShortSaleCanStopForeclosure.com

16. Financial information worksheet

17. Statement of Assets & Liabilities

18. Net worth summary

19. Copy of property tax bill

20. Copy of 2 recent bank statements

21. Copy of 2 recent pay stubs

23. Medical bills

24. Divorce decree

25. Child support payments

26. Unemployment benefits

27. SSI income

28. Authorization to sell

29. Homeowner association information

30. Other to be determined by lender ShortSaleCanStopForeclosure.com

31. Helping You To Preserve Your Credit What Is The Short Sale Selling Process? Homeowner signs listing agreement with real estate agent. Agent finds buyer who offers less than note owing. Homeowner accepts buyer’s offer. Offer is submitted to Lender along with the Short Sale package. Homeowner’s lender accepts buyer’s offer. Transaction closes when the buyer delivers the funds, the lender releases the lien, and the Homeowner delivers the deed. ShortSaleCanStopForeclosure.com

32. Helping You To Preserve Your Credit What Are The Qualifications For A Short Sale? Can you answer YES to these 4 questions? 1. Has the market value of your home decreased? 2. Have you missed a mortgage payment or do you anticipate missing one? 3. Are you experiencing a documentable financial hardship? 4. Is your debt (including your current mortgage) more than your assets? 5. Are you ineligible for a Loan Modification? ShortSaleCanStopForeclosure.com

33. Helping You To Preserve Your Credit What Are Some Acceptable Causes of Financial Hardship? Unemployment Divorce Medical emergency Sudden illness Death Bankruptcy Increase in mortgage payment due to of ARM (adjustable rate mortgage) ShortSaleCanStopForeclosure.com

34. Helping You To Preserve Your Credit What Does Not Constitute a Financial Hardship? 1. Bad Purchase Decisions 2. Unhappy With The Neighbors 3. Buying Another Home 4. Pregnancy 5. Moving Into An Apartment 6. In-Laws Coming To Live With You ShortSaleCanStopForeclosure.com

35. Helping You To Preserve Your Credit How Is A Short Sale Different From A Normal Sale? 1. Marketing There is no difference. I utilize the same extensive marketing program. 2. Buyers There is a big difference. Short sale buyers are price sensitive & driven. 3. Home Pricing There is a big difference. Appraisal is based upon other short sales comparing apples to apples. ShortSaleCanStopForeclosure.com

37. Helping You To Preserve Your Credit What Are The Consequences of a Short Sale? 2. Deficiency Judgment The lender may have the right to pursue a summary judgment for the deficiency. Example The bank was owed $300,000 and sold short for $210,000. The deficiency is $90,000. The lender sues the seller for the deficiency. Under HAFA regulations, Lenders must agree not to pursue this option. 3. Blemished Credit Record Short sales will show up on credit reports as a pre-foreclosure in redemption status. The typical short sale will affect credit up to 2 years and 40-60 points, while a foreclosure 5-7 years and 250-300 points.

38. Helping You To Preserve Your Credit Which Is Better, Foreclosure or Short Sale? Fannie Mae: August 2008 Due to the increased incidence of pre-foreclosure [short] sales, Fannie Mae is establishing a 2-year elapsed time period for reestablishing credit following completion of the action. A foreclosure client must wait 5 to 7 years, maintain at least a 680 credit score in the sixth and seventh year, and pay a minimum 10 percent down on future home purchase.

39. Helping You To Preserve Your Credit What Are The First Steps To A Short Sale? 1. My Role As a Realtor I cannot give you legal or financial advice as both fall outside the scope of my license. It is for this reason I strongly recommend also consulting with an attorney and CPA before you make a final selling decision. The 3 keys to successful short sale are: disclose-disclose-disclose! 2. Lender Requirement You must prepare and submit a Short Sale Approval Application Kit with your lender before you can begin selling as a short sale.