SHORT SALES FAQ

Why have Performance Solutions process my short sales?

We have been successfully processing and negotiating short sales since 2003 and have literally done thousands upon thousands of short sales. In addition, our services are free to the agent and their seller and we have a 92% success rate whereas the national average for agents getting short sale approval is only 16%. Your commission depends on the short sale getting approved so why not let us do the work and get the job done for you? 

Do You Only Process Short Sales on Primary Residences?

No. We process short sales on investment properties, commercial properties as well as primary residences. Any type of property can be sold through a short sale.

Do You Process Short Sales Nationally?

Yes, we can do short sales all over the country. 

Briefly, Explain How Does This Process Work?

Upon receipt of a complete short sale package to our office via fax or email (Click here to download short sale documents for your package) we then compile all of the information and fax the completed Short Sale Package to the lender and confirm receipt with lender within 3 – 7 days. It takes at least this amount of time with the lender because of the case loads they currently have. Once we have confirmed receipt, we ask the lender to order an appraisal or a Broker Price Opinion (BPO), and request that a negotiator be assigned. It will be necessary for you the agent to meet the BPO agent or Appraiser at the property the day they schedule to help justify why we are asking for this particular price.

Once a negotiator is assigned by the lender, they will have 30 business days to review the offer. Our negotiations begin the moment a negotiator is assigned. The next step, once we have worked out an agreed upon price with the negotiator, the file is further reviewed by the investor (the individual/company that actually holds the mortgage). The entire process takes 30-60 days, so please inform all parties of the timeframe.

Please review the “How to Submit a Short Sale page” also. 

What happens once you receive an approval on the short sale?

We will notify you, the agent, the terms of the short sale and the time frame by which the property must be closed by per the terms defined by the lender. You will need to notify your client as well as the selling agent. We coordinate the final documents with the title company and the lender. You will need to set up the closing with the title company and all parties. We do not coordinate the time of the closing for you.

How Much Will My Commission Be?

We do not take any of your commission. We ask that you get a 7% commission on your listing agreement, or go back to the homeowner to get the commission increased to 7%. This will generally get reduced to 5 or 6 percent. Occasionally, it may be reduced further; this is rare, however. We try to get you the most commission allowable by the lender that we can.

How Do You Get Paid?

We do not charge an upfront fee and we do not charge the sellers. We are compensated by charging the buyer a Buyer Processing Fee of up to 2% of the purchase price. The Buyer Processing Fee is listed on the buyer's side of the HUD-1. We strongly recommend that the seller's agent put in the Agent's Remarks of the MLS that the buyer is responsible for paying a Processing Fee at closing, and that any offers should take this fee into consideration. We also may receive administrative fees that will be listed on the HUD-1, which are strictly paid by the lender. 

What Documentation Do You Require From the Seller/Homeowner?

From the homeowner we will need a hardship letter, authorization to release information form FOR EACH LIEN, financial information intake form and the last two years of federal income tax returns (first two pages only), the last two months' bank statements, and the last two pay stubs of each borrower. If the homeowner does not have any of this documentation, they will need to provide a short separate note for each missing document stating why they do not have these documents. Please go to: “Download Short Sale Package” for a letter that outlines what we need from the homeowner.

What Other Forms Do You Need From the Homeowner(s)?

Other forms, which we provide, that we will need from the homeowner(s) are a Mortgage/HOA Information Form and the Short Sale Processing Agreement. Also, the seller will need sign a contract addendum with the verbiage we have provided. In addition, the homeowner will need to fill out an Estimated Repairs Form for the lender-this is just to get an idea of repair costs and is not intended as a seller’s property disclosure.

What Does the Buyer Have to Sign?

The buyer must sign the Buyer Short Sale Discount Fee Agreement, which we provide in the short sale package you can download. The Buyer Short Sale Discount Fee Agreement simply states that they have agreed to pay Performance Solutions a fee for the negotiations that allowed them to be able to purchase the property at a discount. Without our efforts the buyer would not have been able to purchase the property at a discount or perhaps at all given the fact that most distress properties are overleveraged.

Does the buyer have to pay the Buyer Processing Fee?

Yes, but the fee is only paid at closing. If our fee cannot be financed into the loan when the buyer purchases the property, then the buyer will be required to bring a certified check for the agreed upon amount payable to Performance Solutions at closing.

What if the Seller is Filing for Bankruptcy?

You cannot sell a home that is in bankruptcy. We will need to start the short sale processing after the property has been discharged or released by the trustee. Make sure when you are listing the property that the homeowners are not filing for bankruptcy; this could waste an enormous amount of your time.

Why Isn't Prequalification Letter Good Enough for the Lender?

For your protection and the sellers, we must make sure that buyers are bona fide buyers. Lenders have toughened lending standards so we need assurance that the buyer can definitively close. Therefore, we must have the buyer go through the credit review process before we can move forward with negotiations.

The lenders in most cases are requiring this as well and in the past we have wasted time with buyers who would never have qualified had their credit history not been reviewed. That said, we require pre-approval or full approval letters with the short sale submission package.

What Does the Lender Consider as a Hardship?

• Need to relocate
• Reduced Income or Unemployment
• Inability to work due to health reasons
• Separation or Divorce
• Medical Bills
• Business Failure
• Death of a Spouse
• Adjustment in mortgage payment or unforeseen increase in monthly expenses
• Any other circumstance that adversely affects someone's ability to repay their mortgage

Can You Explain the Paperwork and How to Submit a Short Sale Package?

All the paperwork is described and explained in the following attachment (click here). Complete sets of paperwork should be faxed to 888-900-2141 or E-mailed as a single PDF to submissions@PerformanceDSP.com.

What is the Best Way to Reach You?

Please email us at info@PerformanceDSP.com and we will answer you promptly.

How Do I Submit Forms?

Our Fax is 888-900-2141. You can also E-mail us at submissions@PerformanceDSP.com