Comments on: Is a Short Sale Right for You?

By: thomas

thomas — Tue, 25 Mar 2008 12:26:22 +0000

I have a lot credit card debt and was thinking of a home equity loan. I just read this article http://hubpages.com/hub/Risky-Second-Mortgage with government tips on home equity loans. I paints a pretty grim picture of them.
Is it bad idea to get a loan to pay of my cc debt?

By: Vicki Lloyd

Vicki Lloyd — Sun, 09 Dec 2007 00:33:50 +0000

Are you aware of any lenders who have pursued borrowers for mortgage fraud? I’ve been told that part of the short sale process includes borrowers having to submit copies of last 2 years tax returns, W-2s, and all records of assets, including 401-Ks, and other retirement accounts.

Many of the stated income loans included “stated income” that didn’t exist!

By: Captain Ned

Captain Ned — Sat, 08 Dec 2007 20:13:58 +0000

Purchase money loans in CA are non-recourse? That stuff won’t fly here back East and explains a lot of the froth in the CA market.

By: Chris

Chris — Sat, 08 Dec 2007 06:01:57 +0000

Richard Geller,

While your claims certainly look promising to the potential short sale candidate, where can I do more research on them?

By: Ann

Ann — Sat, 08 Dec 2007 03:12:21 +0000

Sniglet I have to agree. The first question is… will the lender allow it? just getting to that point is a huge hurdle, now second question..Have a buyer?

By: Mike Lalonde

Mike Lalonde — Sat, 08 Dec 2007 02:48:35 +0000

Refinancing makes sense, the rates are competetive. Now those credit cards and their 25% interest rates are another story.

By: joe c

joe c — Fri, 07 Dec 2007 19:37:02 +0000

nicely done Morgan.

as an investor, i have decided that a short sale acquisition strategy would fit me best, and how you presented it is clean and neat. i enjoyed your interview with Mr. Woodall when i listened to it about 7 weeks ago.

continued success and good health to you and yours.

happy holidays,

Joe

By: Richard Geller

Richard Geller — Fri, 07 Dec 2007 18:54:32 +0000

Hi Morgan, superb post as usual. I run http://www.MortgageReliefFormula.com and in fact it is a home study course for people who want to do their own short sale.

Your sorting short sales out into buckets is helpful.

But in reality, a lender can only pursue you for their financial losses if they do a judicial foreclosure in states where I am most knowledgeable.

If the lender chooses to foreclose through a foreclosure trustee sale rather than through a judicial process, in most states I am aware of, the lender can’t pursue the borrower for any deficiency.

Also, remember that although mortgages are secured debts, a claim by a lender for a deficiency is an unsecured claim and bankruptcy would be an option for people who are in this tough spot.

Finally, in a short sale, you the homeowner are helping the lender out of their problem. The lender has a problem and so do you — your mortgage is their problem too. If you the homeowner bail out the lender by doing a short sale, you can often negotiate how the lender reports to the credit bureau. At least it can show up as Paid-Settlement which is much better than foreclosure or repossession on your credit report.

BTW, I called an left you a telephone message the other day.

regards

–Richard Geller

By: Sniglet

Sniglet — Fri, 07 Dec 2007 18:53:29 +0000

A more important question, I think, for most home-owners is what they should do if they are deeply under-water, with their house being worth considerably less than the mortgage?

Most lenders likely won’t even allow short sales merely because your home is worth less than the mortgage if they think you have the ability to continue making payments. I think that most people in this situation (i.e. with homes that are DEEPLY under-water) will likely just decide to walk away and default.