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What are my chances for a short sale? Never behind, loss of income, 3 loans?

Profile picture for Brooksidewalk
Hello,
I have a home currently 80,000 underwater. I have 3 loans (1st, 2nd Equityloan and 3rd Equityline). Refied the 2nd with a different institution before the crash, so it is recourse and I believe the 3rd would also be a recourse. Have loss of income from the bad economy and no one will refi. Saving are almost up. Looking to do a loan modification or short sale. Wondering what are my chances of getting approved for either or what is the best option. Thanks for any advice.
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December 31 2008 - Valencia
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Answers (5)

Profile picture for homesla
Real Estate Agent
Contributions: 32
Hi Brooksidewalk,

I'd suggest you short sale your home quickly.  As far as a refi, forget about it.  Your credit will take a hit but you will most likely be financially better off.

Be sure your home is listed on Valencia Short Sale homes located at http://www.shortsales.la
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February 25
Profile picture for IPL Mortgage
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I'm not sure if you're still looking for a short sale or not? If so, contact me. I have a business partner who specializes in short sale negotiatons&transactions that can help you at no cost.
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February 13
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Linda Slocum, "SantaClaritaRE"

Valencia Santa Clarita CA

Real Estate Agent

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Contributions: 212
Loan modifications come in many forms, but all will require you to provide proof of sufficient income in order to qualify for the modified loan.

If you are behind in your mortgage, they will usually tack that amount on to the current mortgage balance, which may have the effect of increasing your loan payments. This may be offset somewhat if they will also agree to lower your interest rate on a temporary basis.

If you fail to qualify for a loan modification, your bank may choose to participate in the HOPE for Homeowners program. This program also requires a certain level of income to qualify and is a last resort in the loan modification arena.

A short sale for owner-occupied homes usually results in the subordinate loans (2nd and 3rd) being written off as well. The 1st mortgage is in control of the short sale, and any funds left over after their payoff (if any) will go first to the 2nd mortgage, and then to the 3rd. Many banks will provide a small payment of $1k-$3k to the 2nd or 3rd mortgage just to facilitate the short sale.

There is the possibility that the 2nd or 3rd mortgage holder will require that you sign a note to pay off the balance as an unsecured loan, but we're seeing that more often with investor-owned homes than with owner-occupied homes.

All of these options will require a hardship letter from you explaining your current situation, proof of your current income, and proof of your current bank accounts.

The best way to find out your true situation and the best way to proceed is to contact a local Realtor who is experienced with short sales. [content removed by moderator for being self promotional]

Linda


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February 06
Profile picture for 5hvdbvv
Contributions: 90

You will need an income to do a Loan Mod. You should list your home below market ASAP and pray for a Short Sale approval.

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February 02
Profile picture for Rob Cochems
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If you want to keep the home, a loan modification is your best choice.
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December 31 2008
 

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