Preforeclosure: List of documents I need HO to provide


I’m trying to create a checklist for myself of the documents I need the homeowner to provide me in preforeclosures. What do I need? Does that list differ from that of short sale candidates? ???


If you plan on doing a workout you will need:

  • Authorization to release info.
  • Hardship Letter .
  • Financial Info ( Income & Assets worksheet).
  • pay stubs ( @2months).
  • If self employed you need Profit & loss Statment.
  • Tax return (Federal ) I usually get past 2 years.
  • Bank Statments (past 2 months, all pages).
  • payment coupon or statement from lender ( to verify names and account #).

For a short sale you need to add

  • offer letter
  • listing agreement.
  • purchase contract (between you and the homeowner for the offer amount).
  • low comparibles of like properties.
  • preapproval or proof of fund letter.
  • repair estimate of needed repairs (from a contractor if possible)

If I’m leaving anything out … please add

good luck,



Thanks for the speedy reply. As is often the case with us newbies, one question answered generates other questions.

What’s a “workout?”

Thanks again,

Its an arrangement to negotiate the back payments and allow the homeowner to stay in their home. (ie loan modification, forebearance,etc)

good luck,


In the words of Mr. Spock, “fascinating”!

Thanks again. I really appreciate it!


What is this line item in your shortsale doc listing?
Could you shed some light please?

  • listing agreement.


Hi Krish1,

Most lender will required that the property be listed for sale with a realtor before considering a short sale and will want a copy of the listing agreement.


Thanks Tony,
In most situations, no full service real estate
agency will accept the property if there is no equity.
Now, if it is in foreclosure, they will want to see the
source of funds upfront
towards their commission. In this case, how does one
proceed. ? Is the property to be listed below what the
owners will owe the bank?

Now,if an investor wants to
purchase, can the investor bring in a RE agent into the
picture just to list it ,with the hope that if the bank
agrees to the shortsale, the realtor perhaps gets to
sell the property on behalf of the investor?


correct, don’t forget , if the property is listed the lender will pay the realtor a commission in a short sale deal. (not the full amount usuall @ 3-4%)


Tony, some great advice.

Two questions for you.

  1. If I’m talking with the seller who’s in foreclosure and I say, I can try to talk to the bank to give a forebearance or restruction your loan (for a fee of course). How am I able to do this and not them? I imagine they’d just say we can do that ourselves, we don’t need you.

  2. I see myself (a realtor) running into trouble if these homes have to be listed with a realtor before a short sale. Its in an agents ethics to get the highest and best price for the home…I see some complications here…any thoughts?


Hi Ryan,

Here’s my answer, working backwards.
#2. I went to a seminar goven by Robyn Thompson, who holds a Realtor’s license. Her primary function is that of an investor, however. She discloses to the client that she is a licensed realtor in a brief paragraph in the contract, but that’s it. She doesn’t dwell on it. Also, when you say it is your obligation to get the highest… price for the home, is that when you have a contractual agreement to list the person’s home? I see the scopes as different. Here you’re acting as an investor, rather than as a realtor.

#1. Why wouldn’t a homeowner contact the bank themselves? There could be several reasons: they don’t know that alternative avenues exist, they are totally stressed out and not thinking straight, they don’t know where to begin to look for alternate avenues…

Hope this helps.

Don’t overestimate the homeowners knowledge, when they get behind on payments they don’t know what to do, so they do nothing. Most of them need to be guided through the process. I recently had a homeowner call me and asked me to help her fill out the papers to do a forebearance that was sent from the lender and she would gladly pay my fee for doing it because “all this paperwork is too confusing”.

It is my understanding that, if lawsuits were to occur in the future, that you can be held accountable for not abiding by realtors ethics. the real estate board of directors can say you did not act in an appropriate manner. the courts will also say that “you know better”…even if this is not the case. i agree that im acting as a buyer and not a listing or buyers agent but you are still bound by certain laws, ethics etc.

ie/if i advertise i buy homes…even as a principal. i have to put that im a licensed realtor as well!

thanks for the reply!