Hello Everyone,
I have been a mortgage broker for 7 years. I saw a thread where a woman was short selling her house.(see simplified short sale explaination at the bottom)
The Woman asked us here if she should SIGN a 10K note to the lender to make her pay the lender the difference between the short sale offer and their minimim amount of REO. She also said that she was about to file Chp. 7.
The lender is asking her to sign a big fat IOU for the difference between what the new buyer is offering and the minimum price they will take to consider her loan free & clear. BTW guys--SHORT SALES STILL SHOW UP AS A FORECLOSURE ON YOUR CREDIT!!! The only advantage is the lender cannot sue you for expenses or losses....
THEREFORE--If you are filing Chp. 7 anyway....DO NOT SHORT SALE YOUR HOUSE. It's a big waste of your time. Just include the house in Chp. 7 BK and live there for FREE while they take 6-8 months to get around to kicking you out. AND FOR GOD'S SAKES DO NOT Sign a NEW Promissory note for 10k or 20k or anyK for any difference. Especially if you are filing Chp. 7.
Even if you are not filing Chp. 7...at least in the past, the lenders RARELY try and sue you after foreclosure for the amount they did not get at the auction. Do not let some commission HUNGRY Real Estate Agents, Lawyers or Lender employee's convince you to sign a promissory note for any money. Your Credit is ALREADY ruined. You TELL them this: I am sorry, but I will NOT sign my name to promise an amount of money that I cannot afford to pay back!!!
And TRUST me guys--Your Real Estate Agent is drooling over that commission and will be the FIRST person to beg you to sign a note like that to get the sale done.
SOLUTION: You TELL the R.E Agents to each CUT their commission to EQUAL that 10k the lender wants--and guess what?? Problem solved withOUT you going into more debt.
Good Luck to everyone!
To put it simply: A short sale of a house or car or anything is when you call the lender, tell them you can't afford to pay anymore BUT you have a new buyer willing to take it off your hands at a discounted price. Say YOU owe the lender 250K on your house. You have a buyer who will pay 195K. You tell the lender they can accept the 195k and NOT come after you for the difference or any expenses. This SAVES the lender the extreme money, time and expense of a 6 month foreclosure process just to end up selling it for about the same discount anyway.
I have been a mortgage broker for 7 years. I saw a thread where a woman was short selling her house.(see simplified short sale explaination at the bottom)
The Woman asked us here if she should SIGN a 10K note to the lender to make her pay the lender the difference between the short sale offer and their minimim amount of REO. She also said that she was about to file Chp. 7.
The lender is asking her to sign a big fat IOU for the difference between what the new buyer is offering and the minimum price they will take to consider her loan free & clear. BTW guys--SHORT SALES STILL SHOW UP AS A FORECLOSURE ON YOUR CREDIT!!! The only advantage is the lender cannot sue you for expenses or losses....
THEREFORE--If you are filing Chp. 7 anyway....DO NOT SHORT SALE YOUR HOUSE. It's a big waste of your time. Just include the house in Chp. 7 BK and live there for FREE while they take 6-8 months to get around to kicking you out. AND FOR GOD'S SAKES DO NOT Sign a NEW Promissory note for 10k or 20k or anyK for any difference. Especially if you are filing Chp. 7.
Even if you are not filing Chp. 7...at least in the past, the lenders RARELY try and sue you after foreclosure for the amount they did not get at the auction. Do not let some commission HUNGRY Real Estate Agents, Lawyers or Lender employee's convince you to sign a promissory note for any money. Your Credit is ALREADY ruined. You TELL them this: I am sorry, but I will NOT sign my name to promise an amount of money that I cannot afford to pay back!!!
And TRUST me guys--Your Real Estate Agent is drooling over that commission and will be the FIRST person to beg you to sign a note like that to get the sale done.
SOLUTION: You TELL the R.E Agents to each CUT their commission to EQUAL that 10k the lender wants--and guess what?? Problem solved withOUT you going into more debt.
Good Luck to everyone!
To put it simply: A short sale of a house or car or anything is when you call the lender, tell them you can't afford to pay anymore BUT you have a new buyer willing to take it off your hands at a discounted price. Say YOU owe the lender 250K on your house. You have a buyer who will pay 195K. You tell the lender they can accept the 195k and NOT come after you for the difference or any expenses. This SAVES the lender the extreme money, time and expense of a 6 month foreclosure process just to end up selling it for about the same discount anyway.
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