Key Bank

Short Sale Telephone: 866-325-4765   |   Short Sale Fax: 216-370-6094

Note: Do not follow menu prompts, repeatedly press # to get to a Customer Service Representative

Required for Initiation

To initiate, fax:

  1. Request for Short Sale Approval: (https://www.key.com/kco/images/short_sale_request.pdf)
  2. 30-days Pay Stub showing year-to-date earnings
    1. Profit/Loss Statement if borrower is Self-Employed
  3. Purchase and Sale Agreement
  4. Estimated HUD
  5. 3rd Party Authorization

The Process

Key Bank negotiates through fax and phone.

Customer Service: Provide updates, send requests to the work out department, communicate document requests

Workout Department: Order appraisal, respond to the offer, respond to investor fee caps, determine relocation incentive eligibility, request investor-specific requirements, determine cash contribution requirements

Timeline for Approval

  1. Manually fax the short sale package, wait for the documents to be uploaded (5-7 days)
    1. Note: Call 48 hours after the documents are faxed to confirm receipt
  2. File immediately assigned to Workout Department (1-2 days)
  3. Workout Department reviews file and requests any additional or corrected documents through Customer Service and orders the BPO (5-15 days)
    1. Note: This time-frame is highly dependent on how quickly parties can return/correct documents
  4. Workout Department responds to offer (5-15 days)
  5. Upon approval, Workout Department submits to the Investor for final approval (3-7 days)
  6. Workout Department issues approval letter

Four Lender Specific Tips

  1. Call Frequently for Updates: Unlike other lenders, the Workout Department will not update unless prompted. Expedite the approval process by calling Customer Service every 48 hours for an update.
  2. Send other approvals ASAP: Key Bank will not review an offer until they receive written approval from other lienholders. Ensure Key Bank has a complete financial package to review immediately upon receipt of other lienholder approvals.
  3. Complete Documents: Check every box, date every line, write “n/a” in every in every non-applicable section. Cut down on document collection time by submitting complete documents.
  4. Deficiency Waiver v. Lien Release: In second position, Key Bank typically will only issue a lien release for the amount the first approves. Key Bank will consider full deficiency waiver for around 40% of the principal balance.

Value Dispute Procedure:

Lender counters the offer higher than the parties believe the property is worth.

  1. Respond to lender's counter with the buyer's highest and best
  2. Provide an independent appraisal or full agent MLS sheets for three comparable sales (providing all characteristics), and if available, three active comparable property MLS sheets
  3. Provide a CMA report
  4. Comparable requirements:
    1. Closed sales no more than six months old
    2. Similar in size, age, condition and characteristics
    3. Within one mile proximity of the subject property; OR
  5. If there are Repair/Hazard Issues:
    1. Provide a line item repair estimate from a licensed contractor or engineer on business letterhead with the costs to cure the damage
    2. Provide photos of the damage
      1. Note: Excessive photos will be rejected
      2. Place photos in a zip file if sending more than three
  6. Time given to provide documents for value dispute: 24-48 hours
  7. Potential wait time for value dispute results: 2-4 weeks
    1. Note: This time can be expedited if you provide a complete dispute package and follow-up every 2-3 days.

Lender Specific Documents

Lender Escalation Procedure

If more than five days have passed without movement on your file:

  1. Call Customer Service in the short sale department
  2. Request they email the Workout Department to update the file

Wait 48 hours, if no response:

  1. Call Customer Service in the short sale department
  2. Request they transfer you to the Workout Department
    1. Explain that there have been no new updates in 7 days and that you need to speak with someone in the Workout Department. Expect to have to make this request multiple times before being transferred.

Wait 24 hours, if no response:

  1. Call Customer Service in the short sale department
  2. Request to speak to a supervisor
  3. Ask Customer Service supervisor to reach out to supervisor in Workout Department for an update

Closing Process

  1. No Final HUD-1 Approval: Key Bank does not issue final HUD approval; as long as the parties comply with the approved terms, Key Bank does not require final HUD approval.
  2. Sign and Return Final Closing Materials: Upon approval, Key Bank issues closing instructions and requests signatures on final closing documents.
  3. Processing Tips:
    1. Include last name and loan number in the subject line of all email correspondence
    2. Include a forwarding address for the seller
    3. Continue to follow up with Customer Service Representatives in case the Workout Department needs anything new at Closing.

Approval Extensions

Unlike other lenders, Key Bank issues approval letters good for 90 days.

If the approval expires, the Workout Department will request updated financials and an updated Key Bank Request for Short Sale Approval before issuing a new approval letter.