You or your Realtor should call the bank and ask how they handle this situation.
Hope that helps.
First thing is to make sure you or the authorized third party to call the bank and verify that they have the short sale package. If so then it should be ok. Some banks are so busy that they don't always have updated information. Last year one seller received a letter saying that the bank received the short sale package and then the next day a letter stating that the bank is foreclosing.
Right now I had 30 short sales under contract on the listing side so I deal with this all the time. It's a good idea to contact the bank on a regular basis. If you're missing mortgage payments, keep in mind that some banks will put your loan through their recovery department and depending on the bank this is not fun. So time to time, it's a good idea to make even a small payment to prevent the loan from going into the bank's recovery department.
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Have your agent call the Short Sale department. Often if the bank knows you are working with a Realtors to sell the home, and you have an offer, they will hold off on the foreclosure.
Get all your documents together for the lender, banks statements, tax returns, paystubs, and letter of explaination regarding your financial situation and why you are a good candidate for a short sale.
If you don't have a Realtor give me a call: