BOA short sale...Seller not in arrears

[Mitch Kenney]

My Uncle in law owns 2 houses in Washington state and he wants me to do a short sale on one of them. He is not in arrears on the property and the loan is with BOA. I have heard of short sales going through even if the loan is not in default. He does not want to sell the property with a realtor because he wants me to get the money from the short sale.

Any advice?

[Scott Hubbard]

Come on guys! Mitch already said he has a hardship! His uncle cannot afford the payments and the house has no equity. (With REALTOR comissions and closings costs will mean he is NEGATIVE)

In my opinion, since your uncle has a hardship and there is no equity, he does qualify for a short sale.

Bottom line, most lenders will compare the projected Shorts Sale Net proceeds against the Net proceeds in a REO scenario. Therefore, even if your uncle has a little equity, it will undoubtedly be covered by espenses in either scenario.

Do not encourage your uncle to miss his payments, this should be something he needs to consider himself.

Additionally, the bank will likely require an at Arms Length transaction, or your local or state laws may also require this. Technically, your relation to him may disqualify you, so do some research and call local title companies just to be sure.

Good luck!