Does your short sale real estate agent know how to prepare a HUD-1?

In a standard real estate transaction, the HUD-1, also called a settlement statement, doesn’t appear until just prior to closing.

This document, usually prepared by the escrow officer, shows the financial accounting on both sides of a real estate transaction. It lists all the costs on both the buyer and seller sides, and is used as a guide in dispersing funds after the sale has closed.

But that’s not the case for a HUD-1 in a short sale.

The HUD-1 has to be prepared and submitted to the lender’s asset manager along with the short sale request. Why? Because a short sale lender won’t agree to the selling price until they know exactly how many dollars they will net from the sale.

Unfortunately, many San Diego real estate agents don’t have the experience to accurately anticipate all the costs that can crop up during escrow – and don’t know how to prepare a HUD-1 for a short sale even if they did. After all, the HUD-1 preparation isn’t part of their duties in a non-distressed sale.

That lack of knowledge often leads to the failure of the short sale.

If the HUD-1 is improperly prepared and unexpected costs crop up after the lender has agreed to a short sale, the transaction will halt and go right back to the negotiating stage.

That means another long delay and often leads the buyer to cancel the contract. Even worse, it can add enough time for a pending foreclosure to be finalized.

The HUD-1 is just one of the reasons why San Diego home sellers should always choose a listing agent with the experience and know-how to handle a short sale. If an agent doesn’t understand it and doesn’t follow the correct procedure, attempting a short sale can end in foreclosure.

We do understand San Diego short sales and we do know how to prepare a HUD-1 for a short sale. In fact, we’ve successfully closed 98% of the short sale listings we’ve taken in the past 9 years.

San Diego short sales aren’t fast or easy. But they’re not impossible, and they don’t need to take a year to close. You just need an experienced agent who knows how to deal with the banks in a manner that gains their cooperation.

So if you’re thinking of short selling a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, get in touch. We’ll be glad to explain how a San Diego short sale works and answer all your questions.

To reach us just call 619-929-1413 or write

Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.