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HAFA Short Sale

I was just informed that my offer got accepted for a HAFA short sale property. As a buyer, what documents do I need to request from the seller? I know that the bank has to finally approve the deal, but should I also request a copy of the contract signed by the sellers? Would they be able to renege on their decision once they accept my offer?

Thank you so much for all your help!

P.S. The listing agent is serving as a dual agent, hence the need to reach out for some sound advice.
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June 18 2012 - Salinas
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Answers (4)

Daniel,
In California, you should have signed a Short Sale Addendum (click to view a copy) in addition to your purchase contract.  It discloses and states some of the unique issues with short sales.  It says when your deposit will be due (usually after bank approval of the short sale) and notifies you that the the lenders approval is required for the short sale, is not guaranteed and means the contract is not binding if the approval is not received.

Regarding what documents you need from the seller on a HAFA short sale, there isn't anything different from a standard sale.  You each need to sign the contract and addendum.  It's usually a good idea to add clauses to the contract that require the agent or their negotiator to present the short sale package to the bank within a set period of time (usually ASAP) and to provide you periodic updates of the status.

From there it's pretty much "hurry up and wait" until the lender(s) approve the terms of the payoff.

I hope this helps. Good luck with the sale.
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June 22 2012
Your agent should provide you with a signed copy of the purchase agreement soon after all parties come to an agreement.

The banks approval is often written as a contingency (like an inspection contingency but this one favors the sellers). Sometimes the bank will either request a higher purchase price, reject the short sale (based on the sellers not meeting the banks rules) or require the sellers to financially contribute to the sale. So until you have the banks approval, your offer is still not final.
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June 18 2012
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Hi Mary, 

Thanks for your speedy reply. I think that I signed a representation agreement with the agent, so I can't really jump ship. Plus, my loan is FHA, so I tried to work with a few buyer's agents, but my offers were never accepted. 

I will be sure to ask for a copy of the contract signed by the sellers. Please let me know if there's anything else that I need to do to protect my own interest.
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June 18 2012
If you are not sure if you can trust the listing agent, I would suggest getting  another agent to represent you. Did you sign an agreement with listing agent? Yes you should have a copy of the contract signed by the seller.

Good Luck!

Mary
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June 18 2012
 
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