You’ll be assembling vital evidence in a Short Sale Packet as part of your work with the homeowner to put together a short sale. In preforeclosure deals this package is very important. The Short Sale Packet provides enough information to convince the bank to accept your short sale offer on the homeowner’s property and get the homeowners out from the under the obligation.In your request for a short sale you’ll want to include everything you can that backs up your request for a short sale. Obviously, leave out extra evidence that may hurt your claim, but don’t purposely hide the homeowner’s income or other necessary pieces of information. You really just want to show the homeowner’s life at its worst and the house at its worst.What’s in a Short Sale Packet?Authorization to Release Information: The homeowner needs to sign this document stating that they authorize their lender, the bank, to share all vital information concerning their mortgage with you. The bank won’t talk to you if you don’t have this!Letter of Agreement and Addendum: This document states that you will work with the homeowner and the bank to stop the foreclosure, but you can’t guarantee that the bank will agree to stop the foreclosure during short sale negotiations with you. Don’t ever forget this document and make sure you point this possibility out to the homeowners when working them.Warranty Deed to Trustee: This basically shows who owns the property you are attempting to purchase. You’ll need to get a notary to authenticate this document.Standard Purchase and Sales Agreement & Escrow Instruction: This is the standard sales contract between you and the homeowner, since you will actually be purchasing the property from the homeowner with the bank’s approval.Agreement and Declaration if Trust: Keep your name off of public records with this document which declares a land trust on the property. Trusts are getting harder to use in many areas. Ask a local pro as to how they deal with the title.Financial Statement: These are the homeowner’s pay stubs, copies of their past income tax returns and other items that show the homeowners really are in financial hardship.Hardship Letter: This is important in pre-foreclosure investing. The hardship letter allows the homeowners to explain in detail all of the reasons they were unable to make payments on their mortgage and why they’ll be unable to completely pay off the mortgage. A good hardship letter can really help you seal the deal.Special Power of Attorney: When working in pre-foreclosure investing you’ll get this signed by the homeowner in front of a notary. It applies only to the property and lets you make decisions concerning the property if something happens to it before the short sale deal closes.Letter That Trustee is making Payments: This letter indicates you’ll be taking the property “subject to” and notifies the lender that payments will be coming from a trustee.Escrow Letter: This letter tells the bank to apply funds in an escrow account to the loan balance when the loan is paid in full and the short sale deal is complete.Be aware there is no guarantee the bank will comply with the instructions for your real estate investment. They may send the escrow proceeds to the original borrower, which is the homeowner.Residential Real Estate Disclosure: This is protects everyone involved in this pre-foreclosure investing project. It discloses any defects in the property and prevents anyone from claiming that they weren’t aware of certain defects in the property after the deal is completed.Extra Pre-foreclosure Investing DocumentsIn addition, are a few extra documents you can include in your Short Sale Packet to get the bank’s attention in this pre-foreclosure investing deal.Cover Letter: Make your Short Sale Packet stand out with a cover letter. It basically states who you are as an investor and that you are requesting a short sale and why the bank should take the short sale.Opinion of Value: This is a professional estimate or your own statement from experience in pre-foreclosure investing. You’ll back it up with a quick list of all the negative points of the property, its needed repairs and the lowest comparable sales in the area.Color Photos: Send the bank pictures of the damaged and neglected areas of the house. They provide photographic evidence of the low market value of the property and encourages the bank to accept your discounted offer.Estimate of Repairs: Get estimates for all of the repairs needed on the house and include those estimates in your Short Sale Packet to back up your discounted price.Proposed Closing Statement (HUD1): Eventually you’ll find that a bank requests the HUD1 form, so it’s a good idea to include this document anyway. It shows all the fees and payments that will be made to the parties involved in the short sale.Notice of Trustee’s Sale: The homeowner receives this notice when their property is going to the foreclosure sale. You are letting the bank know that you are aware of the pre-foreclosure investing process by including this document in your Short Sale Packet.Pre-foreclosure investing is an involved process, but when you properly complete the Short Sale Packet you’ll be one step closer to this essential part of debt negotiation with the bank. The Short Sale Packet contains information that the bank requests from you and your own research on the property to back up your request for a discounted sale price on the property.