Selling a home in this type of environment needs a different approach. If you do intend to sell your home as a short sale, this market is a bit more rough. If you need to sell your home for less than what is owed, here are some tips:

Document your financial hardship
You are required to have a detailed list of your accounting for your financial condition which includes bank accounts, investment account, a credit report, letter documenting your situation, and credit report. The bank will also request to appropriate professionals if you give authorization.

Set the Stage
A home should still be “presented” even if it is being sold for less than the ideal amount. The home will be competing with other homes, so unless a home buyer is very much in love with your home, you won’t have much negotiating room if your home doesn’t look that well. Make the buyer want to make an offer and wait out the long drawn out process due to the great condition of the house.

Competitive Pricing
There is actually quite a bit of activity happening in the real estate market right now, so it serves you best to have a good understanding of the real estate market in your neighborhood to get a good idea on proper pricing. Pricing a home competitively will get several bids and will sometimes yield an above listing price. Proper pricing is critical to succeed in this market. Be prepared to make adjustments quickly to reflect what is happening in the current market. Emotional attachment to the home will not and should not apply to pricing the home as most buyers in this market are looking at the bottom line.

But remember that short sales can take 90 days for an approval as loss mitigation departments at the mortgage companies are very overwhelmed with many other short sale applicants. It’s best to pick a selling agent who has great communication skills and can work with your bank or lender.

It can be awful, but everyone in the process will be anxious (the seller who wants to sell, the willing buyer). The bank really has the reigns on the time line of the short sale and everyone only has the choice to work at their speed. If you only have 1 lender involved the process can be quick but with 2 lenders, you can almost be sure that the work to close will be more complicating for the seller’s agent and seller. At times there are “stand offs” on the amount that each lender has agreed to lose.

You can try to “push” the lender to hurry up on the short sale, but most of the times it will do nothing. Since all the mortgage servicers are bombarded with orders, they are working on them as fast they come in. Do your homework though, and double-check if there is PMI (private mortgage insurance) when doing a short sale as this will typically move the process along slower.