Homeowners getting up to 30,000 to do a short sale!!

[Joel Owens]

I focus on commercial and haven't completed a residential short sale in about 4 years.

Me and my other broker friends I have been talking to recently are mentioning they are completing residential short sales on the HAFA program where the bank is paying the home owner up to 30,000 on the Hud-1 to move!!

It depends on the bank and the ones mentioned so far are BOA and Chase.

Has anyone else have this happen on their deals???

[Rob K.]

What I find appalling is that a seller would walk away from a short sale with any money. When you sign a mortgage, you are promising to repay the money that you borrowed. It’s not the bank's fault that the value of the property went down. What if the house doubled in value and the bank said, “You just doubled your money, so we want some of it.” That would never fly.

If a bank wants to do a short sale, that is up to them. If I loaned money to someone, I would expect to be repaid in full. I think the banks should tell these people that they are paying the deficiency. Not reward them with cash for their financial mismanagement.

The big problem is that people have no shame anymore. It’s become socially acceptable for people to walk away from their house. It’s ok to brag about using food stamps. If you have a backache or you’re an alcoholic, collect social security. Single moms have baby showers. Deadbeat dads go to the bar instead of raising their children. People run up their credit cards and then file bankruptcy. There’s no accountability.

I’ve paid back every dollar I borrowed. Michigan’s real estate market started crashing in 2003 and I had a lot of houses underwater. You just have to have the mindset that you borrowed money and now you need to repay it.

What these short sellers should be required to do is come to the closing with a big check, work out a payment plan to pay the deficiency, stay in the house until they pay it down enough, or wait values come back up and then sell.