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Guest

I own a home in California and loan is 150,000 more than value. I am trying to short sale the property but heard bank of America does not allow short sale. Is that true? my both loan is with bank of America. Do they seek for deficiency amount ?

thank you.
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jameshogg · Posted: Sat Apr 11, 2009 10:39 pm Post subject:

Hi ads,

It will depend on the lender whether he will allow a short sale or not. If they are not ready for a short sale, then you should apply for a deed in lieu. As far as I know, California is an anti-deficiency state. Lenders cannot sue the borrowers for the deficient amount resulting from the sale of the property.

Thanks

Guest

As far as I know the investor is the one who approves the Short Sale. You have to list your home and find a good real estate agent who knows the Short Sale process. You need to give a letter to BA aurhorizing your agent to talk with BA regarding Short Sale. You also need a letter of financial hardship and your monthly expenses to show to BA that you can no longer afford to pay your mortgage. You have to have a buyer who already make an offer to buy your house, otherwise BA will not accept Ahort Sale. Once BA get your letter they will assign a Negotiator to talk to your agent, your agent will send BA the Short Sale package which includes HUD, listing agreement etc. Short Sale is a very draining and frustraiting process, you have to prepare yourself because it's a long process, buyers sometimes canot wait so they backout.

As far as deficiency judgment, CA is a non recourse state therefore, if you have a purchase money mortgage and never refianced your loan eventhough you have a 2nd mortgage, you are covered by CA Section 580b-the Anti Deficiency judgment, meaning the lenders can not sue you for deficiency judgment. However, lenders have tricts and schemes, they buy your 2nd mortgage Mortgage Insurance to cover for situation like this, and the Mortgage Insurance will not approve the release of the 2nd mortgage unless you sign a promissory note stating you are going to pay the balance owed. Don't sign the promissory note just tell them that you are insolvent and rather foreclose the house. Make sure that you negotiate that both loans are fully satisfied with the sale of your house via Short Sale. Hope this helps.

Guest

Thanks for reply jameshogg and faith777. I understand that ba need to approve for shot sale. The home I am trying to short sale is my second home and now renting for far less than what I am paying and value is upside down(-50%). I never took any money from that property and is never refinanced. I think the bank consider it rental property, is that still considered non recourse (anti deficiency) ?
Thanks

smithsussane · Posted: Tue Apr 14, 2009 11:44 pm Post subject:

Hi Ads!

Welcome to forums!

As California is an anti-deficiency state, the lender will not be able to sue you for the deficiency resulting from the sale of the rental property.

Sussane

Guest

if i refinanced my house in Arizona and short sale or foreclose can they sue for deficiency even though they cannot do so in Arizona?

Niicss · Posted: Wed Sep 02, 2009 1:43 am Post subject:

A lender cannot sue you for the deficient amount if it is not allowed as per your state laws. If your lender is doing so, it would be considered as illegal. You should contact an attorney and take his opinion in this regard.

Guest

in Arizona the lender cannot come after you for deficient amount of a short sale. Also can a lender decline a short sale request also can a lender decline a foreclosure in Lieu request, and lastly can a lender decline a foreclosure request. and what are my options if they do, do i just mail in the keys and leave.

smithsussane · Posted: Wed Sep 02, 2009 10:54 pm Post subject:

Hi wlan!

Welcome back to forums!

As far as I know, its the lender's discretion whether or not he would accept a short sale or a deed in lieu of foreclosure request. So, the lender can decline your request.

The lender will check out if you are paying your mortgage dues on time or not. If not, then he may foreclose the property. The lender would send you a foreclosure notice wherein the sale date would be mentioned. You need to contact the lender and transfer the property to him.

Feel free to ask if you've further queries.

Sussane

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