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Answers (9)
- Patti Prescott-Chrisman, "PattiPChrisman"
- Contributions:48
In most cases concerning a "short sale" the loan is marked partially satisfied. With this being the case, the mortgage company could come back at some point and try to collect the difference in the monies. They usually don't but they could. Occasionally, they will send paperwork to closing saying that one is satisfied especially if it sells close to payoff.
- Jody Barnett, "jodymbarnett"
- Contributions:2
As long as the bank specifies in the acceptance of the offer that this price will satisfy all debts tied to this loan then you will have no issues with recurring collections from this note.
- Betsy Pepine, "Get Listed Get Sold"
- Contributions:70
It depends. Some banks create a pay back plan for the seller to complete after closing. Others let the sellers walk.
- Jacque Koutnik, "Koutnik"
- Contributions:179
There is a new program called HAFA Short Sale
This fully releases a customer from a deficiency judgment and also gives sellers $3000 for relocation. Be VERY careful when working with banks and the deficiency. If you are not in the "HAFA" Program you need to have a lawyer from the title company read the verbiage for you. Here is a link to the participating HAFA Banks
This fully releases a customer from a deficiency judgment and also gives sellers $3000 for relocation. Be VERY careful when working with banks and the deficiency. If you are not in the "HAFA" Program you need to have a lawyer from the title company read the verbiage for you. Here is a link to the participating HAFA Banks
- wetdawgs
- Contributions:26833
In order to qualify for a short sale (so unpaid balance is "forgiven"), one must meet a number of qualifications. A main one of these qualifications is that you have suffered hardship such as loss of income, death, divorce and a number of others. If the owner has the ability to pay and other assets, often they end up owing the lender for the difference between mortgage amount owed and proceeds from sale.
Therefore, if you are the owner you need to review your situation with the lender.
Therefore, if you are the owner you need to review your situation with the lender.
- Michelle Cecchini, "Michelle Cecchini"
- Contributions:221
As long as it is your primary residence you should be able to work out the difference as forgiven. I use an Attorney at the point where the lender has agreed on the short sale. This is to ensure you are protected against receiving a deficiency judgement.
- Doug Emde, "Doug Emde"
- Contributions:27
Depends on the Lender. One thing you need to be aware of though is that you might receive a 1099 at the end of the year for $35,000 and would owe the taxes on that amount if you are forgiven the debt!
- Michele Monti, "annearundelrealtor"
- Contributions:81
It also depends on the state.. Many states like Maryland give the right to the third party to implement a "deficiency judgement". What this means is they have "x" amount of years to go after the seller for the remaining balance. I would recommend checking with a local realtor who specializes in short sales. They will be more suited to answer any questions pertaining to FL. short sale law.
- James Dunn, "DunnRealtors.com"
- Contributions:373
It will depend on the lender. Some lenders are willing to forgive the debt, others are not. An option that may be presented is to refinance the difference. Using your example, bank will allow the house to be sold for $70,000, release the mortgage, and then establish a new personal loan for $35,000 with the seller to cover the difference.
I would expect to have to repay the debt in full. As mentioned, it's possible that the lender will forgive the debt, but I wouldn't count on it.
I would expect to have to repay the debt in full. As mentioned, it's possible that the lender will forgive the debt, but I wouldn't count on it.
If you sell a home in a short sale, is the owner still responsible for the balance of the difference
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