This is a supporting guide focused on documentation and your approval package — what to assemble and submit so the lender can review your short sale. For the full overview of what a short sale is, when to consider one, and how it compares to foreclosure and deed-in-lieu, start with our primary short sale overview.
Incomplete packages are a leading cause of short sale delays and denials. Assemble everything below before you submit, so the lender can move straight into review.
Signed purchase contract from a qualified buyer
Hardship letter explaining the financial event and why payments can't continue
Financial worksheet with income, expenses, and assets
Net sheet / HUD-1 showing what the lender will receive
Bank statements (typically last 2 months)
Pay stubs or proof of income
Tax returns (typically last 2 years)
Listing history and any prior offers
1. Confirm the correct submission channel. Ask the servicer which address, portal, or loss mitigation department receives short sale packages.
2. Send proof of delivery. Use a method that produces a receipt, and keep a copy of every page you submit.
3. Log acknowledgment and assignment. Note the date the package is acknowledged and the name/reference of the assigned negotiator.
4. Anticipate the BPO/appraisal. The lender will generally order a Broker Price Opinion or appraisal to confirm value.
5. Expect a decision window. Review commonly takes 30-90 days. Counteroffers are common.
Before closing, read the approval letter carefully for: the accepted payoff amount, whether the deficiency is waived (and in writing), relocation assistance, and any conditions or deadlines. If a second mortgage or HELOC exists, that lender must approve separately. For the full picture of deficiency exposure, see our guide to possible deficiency after a short sale, and for the overall comparison to foreclosure and deed-in-lieu, see the primary short sale overview.