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Wells Fargo Short Sales

Wells Fargo is viewed as one of the more efficient major banks when it comes to short sales. In fact, it’s one of the only banks that will provide a written short sale time line for buyers and sellers. On average, short sales are approved by Wells Fargo within 25-45 days, which is reasonable when compared to other banks.

Although Bank of America still approves more short sales than Wells Fargo, they still are in the top three banks when it comes to approving short sale transactions within the United States. According to one Wells Fargo Spokesman, Tom Goyda, “Our short sale activity is consistent with our delinquency and foreclosure rates, which have been below industry averages.”

Who is Eligible for Wells Fargo Short Sales

In order to qualify for a shortsale with Wells Fargo, sellers have to clearly demonstrate their financial hardship. Some of the financial hardships accepted by the bank include the following:

    • Job loss
    • Mortgage adjustment
    • Too much debt
    • Business failure
    • Relocation
    • Death or illness
    • Property damage
    • Incarceration
    • Reduced income
    • Payment increase

In these cases, Wells Fargo usually will agree to the shortsale transaction and often accepts the short sale as payment in full on the mortgage loan.

Basic Paperwork Required for Wells Fargo Short Sales

The basic paperwork that is required from the seller includes, but is not limited to, the following:

    • Hardship letter
    • W2s
    • Bank statements (two month’s worth)
    • 1099s
    • Listing agreements
    • Tax returns (previous two years)
    • Pay stubs
    • Borrower financial form
    • Third party authorization

Wells Fargo Short Sales and the Use of Equator

Wells Fargo is one of the banks that uses the Equator system, which is used to help make it easier to deal with the paperwork that goes along with a short sale. Equator also works to streamline the short sale process, making it faster for all parties involved. When filing a shortsale transaction through Equator, the following is the normal process:

    • A short sale file is initiated in the Equator system by an agent or lawyer
    • Tasks are assigned to be completed by the agent, beginning with the third party authorization
    • HUD information is uploaded by the agent
    • The file is reviewed by a processor and then assigned to a negotiator
    • Disclosures, including the Arm’s Length Affidavit, need to be signed by all parties involved
    • Other documents may be requested to supplement the file
    • The file will be denied or approved if the bank has delegated authority, or the file will go on to the investor to get the final approval

Next: The short sale process at JP Morgan-Chase