But first of all, anything this good can be subject to fraud and corrupt people attempting to profit from misfortune; so distressed homeowners need to beware of disreputable people who make promises that they will help them get out of debt, but only stand to make money themselves.

While keeping the disreputable at bay, you need also beware of buyers. While they are obviously the critical component in a successful short sale, they must offer qualifications beyond the financial. Short sales take time and patience and you’ll need assurance that your buyer is in for the ride. So besides the obvious confirmations of lender pre-approval or proof of funds if they are cash buyers, please consider:

• Is the buyer making a reasonable offer or will it cause a short sale package rejection?
• Does the buyer understand that this process can take from 1 to sometimes 6 months to be approved?
• Will the buyer agree to spend money on things like application and attorney fees and inspections?
• Can the buyer offer flexibility on the closing date?

If there are any doubts about your short sale buyer, you may want to pass; it will cause you heartache and a waste of time you do not have.

And finally, beware of misinformation. You really can’t believe everything you read nor should you take advice from the “guy down the block” about your short sale – every situation is different, a short sale is a negotiation. So whether you are buying a short sale property or selling a short sale property, enlisting the assistance of a responsible and experienced Realtor is your first and best step.

For example, there are about (15) components that comprise an effective short sale package. Five of these documents include:

• The seller’s financial information
• The seller’s hardship letter
• The comparative market analysis (CMA) of the home
• The fully executed purchase contract (signed by both the buyer and the seller)
• Written proof of the buyer’s ability to purchase the property

Different lenders will dictate how they want all the information delivered, but just about all of them want a proposal cover letter or a “table of contents” page to facilitate their review of the file. Let’s face it…they can pretty much ask for whatever they want.

But with all the things that can go wrong with a short sale, one of the most common reasons short sales fail is due to an incomplete submittal package. If an incomplete package is delivered to the lender, many of them won’t stop to call and tell you what you need to do to rectify it; they’ll just set it aside. They may eventually get around to contacting you, but they are going to handle the ones that provided a complete short sale package first.

When time is of the essence and there is not a great deal a borrower can control, our advice is to control the things you can. So, follow the instructions of your short sale specialist to the letter, compile all the requested detail, and make sure everything is accurate and valid. It can be done; you just have to do it right.

First of all, short sale eligibility requires proof of hardship; and hardship is determined by a set of defined circumstances that change the homeowner’s ability to remain current with their mortgage payments. The following situations would signify short sale candidacy:

• The failure of your business
• The loss of your job
• Divorce
• Death of your spouse
• A natural disaster
• Insurmountable medical costs
• Illness

Your Realtor will help you organize and present all the appropriate short sale paperwork to the lender, but time is a factor in accomplishing a successful short sale.

The process needs to be initiated in the pre-foreclosure phase which begins with the first mortgage payment default. The foreclosure timeline in your state starts the clock against how long you have to list the home, find the buyer, and get the sale approved by the lender.

Consult an experienced short sale realtor to assess your situation and hopefully get you out from under.