A real estate property short sale is in most circumstances a most difficult transaction to handle. Signing away ownership your precious real property investment is a painful decision to make in whatever way you will look at it. It leads to a whole lot of other problems which include damaged credit standing, embarrassment and the loss of dignity of an owner being stripped of ownership to his home.

A growing part of the real estate sales in recent times are short sales. This is an indication that this option can be your best route if handled properly. A short sale is possible when the lender agrees to accept less than the due amount from the mortgage. Short sale is basically a discounted payoff which shall be resorted to by the lender in lieu of foreclosure. However, one should remember that not all real estate properties can qualify under a short sale setup.

On the other hand, if you are seriously considering a short sale for a property, it is important that you know of several drawbacks that are associated to such type of real estate transaction.

Here are the important things that you must do if you are going to pursue a short sale of a real property:

1. Retain the services of a legal counsel – The short sale involves a lot of legal issues and it is essential that you are provided with relevant advice by a competent lawyer with the expertise in such short sales transactions.

2. Hire an accountant to learn the tax implications – Before you proceed with the short sale transaction, it is essential that you consult with a CPA with regards to the ramifications of the short sale on tax exemptions under applicable tax laws and guidelines.

3. Coordinate with the Mortgage Lender – Expect to have a regular and close contact with the mortgage lender when you finally decide to make a go for the short sale. It is essential that you coordinate with the person who has the authority to make decisions regarding the short sale transaction.

4. Present a Letter of Authorization to the Lender – In order to facilitate the short sale transaction, it is important for you to present a letter of authorization to the lender. This authorization shall allow the lender to coordinate with relevant parties about your loan.

5. Obtain Preliminary Net Sheet – This is the financial schedule that describes the circumstances behind your financial difficulties. It contains all the pertinent information like the cost of the sale, outstanding loan balance, late fees and charges and other related fees associated to the sale.

If you are able to hurdle all the requisites, then you should expect an approval of the short sale by the mortgage lender. During the negotiation phase, don’t forget to request the mortgage lender not to submit an adverse credit feedback to credit reporting companies.

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