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Answers (5)
- Phyllis Watson, "PhyllisW"
- Contributions:122
I don't believe the seller can receive any funds/proceeds from the sale of the home. I would have your agent notify the lender immediately. I would also have your agent contact the California Association of Realtors legal hotline to confirm the legality of the seller's actions. The service is free to Realtors.
Good luck!
Good luck!
- Alan Strange, "Alan Strange"
- Contributions:93
Yikes, seller's cannot benefit from a short sale so having that done is going to break all kinds of laws, rules and policies. They are putting everyone involved in that transaction at risk. If it's not on the HUD then it doesn't exist and if the bank was aware they were 'profiting' then they'd probably nix the whole thing.
- Amanda Nicodemus, "realtyhouston1"
- Contributions:222
Well, there's a couple of things wrong with this short sale.
First, why would you, the buyer agree to pay a contribution to the lender? If there are two loans on the mortgage, the primary lender, i.e. first lienholder will pay a certain amount to the secondary lender, i.e. second lienholder once they approve the short sale. The second lienholder will likely accept an agreed amount, otherwise, if the property goes into foreclosure they will receive zilch,nada, zero!
Secondly, the seller should not receive any funds from the sale of a 'short sale'! Nothing, zero, nada! You, the buyer should not have to pay anything to the seller. You should be paying the downpayment, closing costs, insurance, taxes, homeowners association dues (if any).
I certainly hope you're using the services of a professional real estate agent to assist you in the purchase of this short sale. He/she will advice you accordingly.
disclaimer: This is not to be used as legal advice. You have the right to obtain an attorney.
First, why would you, the buyer agree to pay a contribution to the lender? If there are two loans on the mortgage, the primary lender, i.e. first lienholder will pay a certain amount to the secondary lender, i.e. second lienholder once they approve the short sale. The second lienholder will likely accept an agreed amount, otherwise, if the property goes into foreclosure they will receive zilch,nada, zero!
Secondly, the seller should not receive any funds from the sale of a 'short sale'! Nothing, zero, nada! You, the buyer should not have to pay anything to the seller. You should be paying the downpayment, closing costs, insurance, taxes, homeowners association dues (if any).
I certainly hope you're using the services of a professional real estate agent to assist you in the purchase of this short sale. He/she will advice you accordingly.
disclaimer: This is not to be used as legal advice. You have the right to obtain an attorney.
- B Mike West
- Contributions:240
One wonders how serious these sellers are. They should be HAPPY to accept your deal WITHOUT your giving them any cash. In fact, it is illegal for you to give them any cash. Any funds should go to the lien holder(s) and the seller should be happy to walk away with an approved short sale and, if they are lucky, some cash for keys..
Of course, the final decision is up to you, but I would call their bluff. Take the deal as it stands or you will walk away and they will have a foreclosure on their record. You might also consider reporting the request to the local Realtor's board or the listing agent's broker if it is in writing. There are still to many crooked people out there. You might be better off looking for another property. Good luck with it!
Of course, the final decision is up to you, but I would call their bluff. Take the deal as it stands or you will walk away and they will have a foreclosure on their record. You might also consider reporting the request to the local Realtor's board or the listing agent's broker if it is in writing. There are still to many crooked people out there. You might be better off looking for another property. Good luck with it!
- wetdawgs
- Contributions:26784
It is not legal to ask for "contributions" outside the standard process.
Something weird on my a short sale purchase, Help?
We are in the process of a buying a short sale property. On it there are 2 lenders, the second lender asked for a contribution which we agreed to. Today we finally recieved the lenders approval but something weird went on with it. The first bank agreed to pick up the full contribution for the 2nd lender, and the seller is now saying that because they got the lending bank to cover the contribution they now want us to pay the money we were going towards the contribution to the seller directly. We think the seller was looking for an HAFA? which got denied, and now they are asking for the cash for the contribution. If we dont accept this "new deal" the seller will allow the house to foreclose and then "get cash for keys" through the forclosure.
Is this legal to do in California? If we go through with the new offer what is the risk to the property? is there a chance we will loose it?
Thanks
-Rich
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