2nd won't allow Seller to get relocation funds that 1st approved

[Steve L.]

I have a California short-sale approved.  

The Sellers owes $550k on the 1st.  $150k on the 2nd.

The first approved an offer around market value (around $300,000) and $5,000 in relocation funds and $4,000 to the 2nd.

The second says they will approve the amount but they will not allow $5,000 in relocation funds and wants the 1st lender to remove that option.

Does anyone have any experience with this or suggestions?  The Seller needs the relocation funds.  

[Minna Reid]

Have you tried quoting/making a case for 1st lienholder investor guidelines? Usually if you push these enough the second may reconsider - (ie...It's not our choice! We didn't choose this! Its the first lienholder!! They have to follow their investor guidelines!!! They wont relent!! It's their policy! We really tried...)  if you can produce their guidelines in writing that may help...

If that doesn't work - maybe get a little more to the second? Try allocating the funds differently.