All Forum Posts by: Mitsu O'Riley

If your short sale is approved, it was approved based on the fees on the HUD (net sheet) you provided. They will pay those approved fees. Either seller or buyer have to bring the money to pay you, or go back to the bank (hat in hand) and try to get them to reapprove the deal with less to them for your fee. Not likely to happen.
You need transactional funding, but I'm not sure you have enough room to pay for all that and double closing. You will have to tell us numbers (buy sell costs agents).
~Mitsu

H Mann,
You're 1/2 way there. Just go back to the bank with a lower offer. Justify by time, deterioration, repairs, vandalism, low comps in the area, etc, etc, etc.
That should make them step back and say, Crap, what were we thinking?

If you've got an end buyer, and you're making some profit, that better than none if you walk. You're 30 days away from approval.
~Mitsu

The negotiator has to submit one to the investor for final approval. If you have one then send it!
~Mitsu

I don't know too much about the probate ways, but Maybe this could work. Check with a probate attorney....
Get a copy of the death certificate. Send it to the bank and get it recorded. Send the court and foreclosing attorney a letter regarding the owner's situation. I think the state has probate attorneys. Whoever is assigned to it can give you permission. Also, the foreclosure attorney has to notify the proper party of the foreclosure so they can defend or cure the action. It will take some cash to get the legal stuff working to stop the chains, or slow them.

What about just checking with the foreclosure attorney what they are needing for a purchase price to buy at the court house steps. I know it's old fashioned..... but might be the easiest, unless the owner dying before the foreclosure won't allow for a clear title.

Good Luck.
~Mitsu

I would just ask Litton about it. Maybe not your negotiator for this deal, but someone with some knowledge the hypothetical question.

I feel, if the 1st has approved with the terms in writing, then they could let it slide to get it closed. Now if you're talking 9k when the seller showed he didn't have that, you might have some explaining to do.
On the other hand, the first has investor guidelines to follow. It's their primary, and if they don't have the income to support the payment on the mortgage, then the small amount of assets is not something they go after. The MI co does, but most investors don't ask for the cash contribution on a primary 1st.
Litton is willing to give them 10%, so send in the new HUD with that. Keep submitting until you get a number that works. If the file is "closed" then it wasn't denied. Try asking for a denial letter. I think regulation or investor requires a denial to have a reason now. Like buyer walked. Or insufficient funds for short payoff.

Scott,
I have always told the 2nd, if they want something it has to go on the HUD and that I am shocked they want us, the sellers, etc to do something that can potentially be considered (should I say the f word?) fr aud, by hiding it from the 1st lien holder. They usually realize they went past the line and start figuring out something. But I haven't worked with RTR yet.

~M

This might be different according to states' regs, and I am agreeing that it could come down to law suits etc, but.....

The contract (I think all of them) say:

John Doe (Seller) and John Smith (Buyer) agree to sell and buy .....

And both Johns sign and date and thereby execute the purchase and sale contract. Now the seller can say it is contingent on the bank not requiring a deficiency judgement as his contingency, and the buyer can agree to it or not. I believe the bank not signing the contract in it self would mean they are not a party to it or the restrictions in it.

So the seller can back out of the deal if the bank doesn't waive their right to the judgement; and has the right according to the contract with the buyer.

Also, the short sale addendum says the bank is not party to the terms of the contract, but the contact is contingent to the bank approving them getting a short payoff. This is not used everywhere, but needs to be for clarity and legality.

Look at it this way:
Write in the contract the bank has to accept the short pay as paid in full.
It's not paid in full, it is paid as agreed, settled for less than amount owed. Just because it's in the contract, doesn't mean the bank will report it that way.

It would be good to hear from an attorney on the legal part of this.

(Sorry I rambled, going to sleep)

~m

Do you have a closing attorney? Have them write a letter regarding the legal rights etc for you to send. This way, they are not just taking your word for it.
Remember, the negotiator is someone that has been working collections for a credit card co for the last few years, if they have that much experience. They might own their first home, and have no idea what the numbers actually mean to someone losing their house.

But, at the end of the day, if the negotiator knows in the the state of Oregon, they can't come after the buyer, then they should settle. At this point, push as hard as you can. They already said no. What can they do say no again? And again? Then it gets foreclosed, and they get ZERO?

Shoot, if they fight for the deficiency, I would probably sue them back for not accepting a short sale that ruined the seller's credit for 7-10 years.
They can accept the short sale, release the lien, and reserve their right to pursue the deficiency as allowed by law.

Send it all in writing. When they push your sellers, (if this doesn't pan out) then faxes are recorded in the file, and can be brought to court.
The seller's might have some money to push them back in court by then. Or their may be a class action suit....
They are coming.
~m

who knows if they will come up with other stips, but the approvals are 1 page (even 1/2 a page) for each loan. No 30 day restriction. Now, we have asked for an extension for the probate to finish, and the buyer isn't planning to flip within 30 days, so .....
I will let you know what happens.

Call me. I would love to trade notes.
M

If you rent to the buyers, then know they have an actual loan approval for the amount offered, and can go up. Is their offer close to fair market value?

Also, how long will it actually take for the bank to foreclose once you stop making payments. If it's 4-6 months, rent it to the buyers, unless their are other prospects. You still have liability issues and headaches to deal with, but you have money coming in to help you keep paying the loan. If the buyers/renter are on board, and they totally check out, and they have a loan COMMITMENT for the purchase, and it's fair market offer, and you have a lender that is reasonable, it could be a good solution.

Other ifs you want to cover too. And get a nonrefundable binder deposit, not security deposit.

Weigh it out these buyers or ???? What are your potential options? What are their terms in the contract to buy?
It's risky, but a bird in the hand....

Besides, if they move in, contract to buy, show they are fully capable to buy, put their money where their mouth is, no other reasonable contract options, then you risk them trashing a house the bank will foreclose on.

On the other side, you are still making payments, so you might have a year before the bank forecloses (not sure how long the norm is in VA) to get another offer and hope the buyer closes.

Good Luck.