Proceed with short sale if I have 2 loans? Suggestions?

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phatjoe

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Post Posted: Thu Dec 02, 2010 9:48 am    Post subject: Proceed with short sale if I have 2 loans? Suggestions?
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Hello:

In 2006, I purchased my primary residency in IL for $360k. For 5 months I’ve been trying to sell my house, and finally got an offer for $312k. Unfortunately, the principle balance is still $360k (I’ve only been paying the interest).

I have an 80/20 loan. One loan is in the amount of $290k for Central Mortgage Co., and the other is $70k for CitiMortgage.

At the time of closing, I will have to walk in with $70k (loss in value, tax, etc). I don’t have $70k to cover the difference.

Any suggestions?

Can I proceed with a short sale? Issue being the offer amount is greater than each of the loans. I can pay off the $290, but that still leaves $70k for CitiMortgage.

I feel a bit lost, and I’m looking for some advice.

Thanks,

PJ

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adonis




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Post Posted: Thu Dec 02, 2010 7:52 pm    Post subject:
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Welcome phatjoe,

If you're facing hardship in paying off the dues, then you should contact your lender and apply for a short sale. However, the lender will not accept your request unless you're delinquent on your mortgage payments.

If your property is short sold by the lender, then you'll have to contact the lender and pay off the deficient balance on time. If you don't pay off the deficient balance, the lender can sue you in court.

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