Posted on: 05th May, 2009 05:05 am
:cry:
I lost my job (times are tough finding another) in the mean time I have finally fallen behind on my mortgage payments just this March 2009. I have a buyer who is making a good offer, (considering the property values have dropped) the lender will lose roughly 28K. They are wanting me to sign a 10K promissory note on top of the 1099 they will report, I dont have a job (they dont seem to understand that no job means no income/money) I am a sole source income person when I do have a job. If I do not find work and cannot make payment on that unsecured promissory note what rammifications is there going to be? Does it go against my credit, can they take my car, can they garnish my unemployment checks? Go after tax returns? If I find a job at some point can they garnish my wages... Is there a statute of limitations on these notes? How will that hurt my credit on top of everything else here? Until I lost my job my credit scores were pristine... 770s and higher...
I tried to deal with the lender from the very start (even notified them when I lost my job), they were just totally uncaring, not helpful in any way at all, I have never talked to such rude people in my life?
What is the doom and gloom story on this... Need response ASAP...
I lost my job (times are tough finding another) in the mean time I have finally fallen behind on my mortgage payments just this March 2009. I have a buyer who is making a good offer, (considering the property values have dropped) the lender will lose roughly 28K. They are wanting me to sign a 10K promissory note on top of the 1099 they will report, I dont have a job (they dont seem to understand that no job means no income/money) I am a sole source income person when I do have a job. If I do not find work and cannot make payment on that unsecured promissory note what rammifications is there going to be? Does it go against my credit, can they take my car, can they garnish my unemployment checks? Go after tax returns? If I find a job at some point can they garnish my wages... Is there a statute of limitations on these notes? How will that hurt my credit on top of everything else here? Until I lost my job my credit scores were pristine... 770s and higher...
I tried to deal with the lender from the very start (even notified them when I lost my job), they were just totally uncaring, not helpful in any way at all, I have never talked to such rude people in my life?
What is the doom and gloom story on this... Need response ASAP...
Hi Linda,
If you sign the promissory note, you will become liable to pay the 10k that the lender is demanding. If you do not pay the amount mentioned in the promissory note, the lender will be able to sue you. It would be better if you could pay off the 28k to the lender. I don't think the lender will be able to garnish your unemployment checks but it can definitely garnish your savings account.
In case of a short sale, your credit score will be lowered by 75-100 points
Take care.
If you sign the promissory note, you will become liable to pay the 10k that the lender is demanding. If you do not pay the amount mentioned in the promissory note, the lender will be able to sue you. It would be better if you could pay off the 28k to the lender. I don't think the lender will be able to garnish your unemployment checks but it can definitely garnish your savings account.
In case of a short sale, your credit score will be lowered by 75-100 points
Take care.
you've got a rather unforgiving, uncaring lender there, linda. i would suggest you avoid signing a promissory note if at all possible. i also think you need an advocate working with you. check www.hud.gov to find non-profit counselors who can assist you, or go find a lawyer (better get the free help though).
i've not heard of other lenders asking for this stipulation with short sales. i hope you can get out from under.
i've not heard of other lenders asking for this stipulation with short sales. i hope you can get out from under.
thanks for your feedback other banks have told me the same thing. I am of course dealing with IndyMAC and they say you sign or no deal. I just dont know what to do, its not bad enough I lost my job and house now they want a pound of flesh also.
Sara - They cant get blood out of a rock, I dont have anything for them to take? If I had the 28K I would not be here writing for advice and trying to find out what I can or cant do? I apologize if I sound a little short here but I seem to find it difficult to swallow that at the age of almost 62 I have lost my job, my house and most everything I own, now if you would like to stroke me a check for 28K... I thank you for your feed back, I do.
Linda talk to your current buyer and see if they willing offer little more than what they are willing to pay now.
If for some reason the house goes in to foreclosure and the buyer really wants the house now, it mnay not be available.
Talk to your realestate agent and see if they can negotiate with the buyer for a littel higher price. With good luck, if the byer agrees then, you cna negotiate with yoru bank about forgiving the difference.
If for some reason the house goes in to foreclosure and the buyer really wants the house now, it mnay not be available.
Talk to your realestate agent and see if they can negotiate with the buyer for a littel higher price. With good luck, if the byer agrees then, you cna negotiate with yoru bank about forgiving the difference.
your frustration is understandable, linda.
Well, I sold a condo in a FL for 100K that I purchased for 219K. The bank presurred us to sign a Promissory Note for 30K or no deal. I received a 1099c for 102K that I have to pay taxes on top of the note. The bank (WF) cheat us saying that we will not pay taxes on what we pay back, now my income has been reduced even more and I can't pay the note anymore. DON'T DO SHORTE SALES, GO FORCLOSURE THE BANK DON'T WANT TO HELP YOU THEY WANT YOUR SOUL..GIVE THEM BACK THE KEYS AND LET THEM HAVE THE HOUSE OR INV. PROPERTY.
Remember to see the actions of your lender through financial eyes. Forget not that it is a business to MAKE money, and when it can't, it must minimize it's losses through various means.
I am an auditor for a mortgage company, and though I am not representing them in this matter, I will say they do request a notorized agreement on all short sales (SPO) and deed in lieu (DIL), in the form of unsecured promissory notes that assists in minimizing their losses that they will charge off. We understand that the customer is in hard times and can no longer afford to maintain the terms of the original loan and must seek out alternates to relieve their obligations. offering a promissory note often allows the lender to make the decision of a SPO or DIL a sound financial decision. Lender are NOT obligated to consider, accept, or even humor these types of options, but as the borrower, you ARE obligated to pay back the loan in accordance to the contract you signed. Remember that YOU are doing this in lieu of a foreclosure that will be followed with consequences, that doesn't end at the foreclosure sale. In some states they can garnish your wages up to 27% of your monthly earnings, and it doesn't have to begin immediately......imagine getting that job after 6 months of unemployment, only to find a judgment and wage garnishment waiting for you.
It is not my intent to be so blunt but the market was flooded with inexperience borrowers that remained ignorant even after their foreclosure process because of the sub prime market. YOU CAN'T SIMPLY GIVE BACK KEYS AND EXPECT IT TO BE OVER. IT WON"T BE. Do proper research, consult an attorney (not all charge you for the service).
My best advice. Sign the promissory note. Be willing to negotiate the terms you CAN and are WILLING to meet. Know that if you default on the note, the lender can and often will sue on breach of contract. Also, see if the Buyer is willing to cover the amount as a contingency to pay off the associated note at closing. Good luck.
I am an auditor for a mortgage company, and though I am not representing them in this matter, I will say they do request a notorized agreement on all short sales (SPO) and deed in lieu (DIL), in the form of unsecured promissory notes that assists in minimizing their losses that they will charge off. We understand that the customer is in hard times and can no longer afford to maintain the terms of the original loan and must seek out alternates to relieve their obligations. offering a promissory note often allows the lender to make the decision of a SPO or DIL a sound financial decision. Lender are NOT obligated to consider, accept, or even humor these types of options, but as the borrower, you ARE obligated to pay back the loan in accordance to the contract you signed. Remember that YOU are doing this in lieu of a foreclosure that will be followed with consequences, that doesn't end at the foreclosure sale. In some states they can garnish your wages up to 27% of your monthly earnings, and it doesn't have to begin immediately......imagine getting that job after 6 months of unemployment, only to find a judgment and wage garnishment waiting for you.
It is not my intent to be so blunt but the market was flooded with inexperience borrowers that remained ignorant even after their foreclosure process because of the sub prime market. YOU CAN'T SIMPLY GIVE BACK KEYS AND EXPECT IT TO BE OVER. IT WON"T BE. Do proper research, consult an attorney (not all charge you for the service).
My best advice. Sign the promissory note. Be willing to negotiate the terms you CAN and are WILLING to meet. Know that if you default on the note, the lender can and often will sue on breach of contract. Also, see if the Buyer is willing to cover the amount as a contingency to pay off the associated note at closing. Good luck.
al, you ought not worry about being blunt. people need bluntness, as far too many beat around the bush on this topic and many others. you're right - the market was indeed flooded with inexperienced borrowers (then again, we all are at some point in our lives) and they, in many cases, didn't get any additional education about what was required of them after acquiring their homes.
i don't know if i'd want to advise people to "sign the promissory note" but then again, it seems (from your post as well as from ana m's post) that there's not much choice given in the matter. your advice to consult with an attorney is an excellent idea, and always recommended.
i don't know if i'd want to advise people to "sign the promissory note" but then again, it seems (from your post as well as from ana m's post) that there's not much choice given in the matter. your advice to consult with an attorney is an excellent idea, and always recommended.
Dear Linda,
I too went through the same thing as you with Country Wide. They tricked me and told me to stop making payments on my house for a modification. Well three months go by with them telling me i was in review, then i called one day and was told i was not in a modification and why havent i made my payments? They started the foreclosure process on me. Well i diddnt want to foreclose so we decided to short sell because it would be better on our credit. Well everyone said dont worry it will be fine, untill the last minute last monthe Bank of America pulled a amount of 24,000 dollar promise note and said sign or no deal. This has truley been a nightmare for me. 200 dollars a month for the next ten years. OMG. I was told all kinds of things I dont know who to listen to. By the way George HUD told me to walk away from my house and foreclose it as did springbaord financial. Linda get a real estate lawyer, dont listen to brokers or real estate agents. I hope all is well, and god bless. I know it has been a hard year for everyone. I hope these lenders and agents and all the people who were part of this fraud of the market all get whats coming to them. KARMA is a @#$!*!
I too went through the same thing as you with Country Wide. They tricked me and told me to stop making payments on my house for a modification. Well three months go by with them telling me i was in review, then i called one day and was told i was not in a modification and why havent i made my payments? They started the foreclosure process on me. Well i diddnt want to foreclose so we decided to short sell because it would be better on our credit. Well everyone said dont worry it will be fine, untill the last minute last monthe Bank of America pulled a amount of 24,000 dollar promise note and said sign or no deal. This has truley been a nightmare for me. 200 dollars a month for the next ten years. OMG. I was told all kinds of things I dont know who to listen to. By the way George HUD told me to walk away from my house and foreclose it as did springbaord financial. Linda get a real estate lawyer, dont listen to brokers or real estate agents. I hope all is well, and god bless. I know it has been a hard year for everyone. I hope these lenders and agents and all the people who were part of this fraud of the market all get whats coming to them. KARMA is a @#$!*!
Bank cannot garnish your income unless they go through court process, get a judgement, which will cost them $$$$. Most debts can be neociated to pennies on dollars. I wouldn't sign the promissary note and say I will let the house foreclose and live in it rent free for year plus. Bank will have to give you better term.
Any thign the bank reps asks you, make sure you get it in writing
I too did a shortsale on my home and the bank (Navy Federal Credit Union) required me to pay back $17,000 over the next 10 years. I took the terms verbally to complete the sale.
When it came time to start making the payments I did not have the money to pay them. I began receiving letters in the mail of reminding me to make a payment as it was late, also in the letter was a promissory note with a letter that states they did not have a signed promissory note for that loan and they needed me to sign it ASAP and return it to them.
The bank began taking money from my bank account that was set aside to pay rent and child care as well as they emptied both of my 4 year old sons checking accounts of every dime that they got from birthday cards.
My question is without the bank having a signed promissory note in hand am I really liable to pay them. They have sent me numerous requests and I have since cut all ties with Navy Federal and plan to never do busines with them again.
When it came time to start making the payments I did not have the money to pay them. I began receiving letters in the mail of reminding me to make a payment as it was late, also in the letter was a promissory note with a letter that states they did not have a signed promissory note for that loan and they needed me to sign it ASAP and return it to them.
The bank began taking money from my bank account that was set aside to pay rent and child care as well as they emptied both of my 4 year old sons checking accounts of every dime that they got from birthday cards.
My question is without the bank having a signed promissory note in hand am I really liable to pay them. They have sent me numerous requests and I have since cut all ties with Navy Federal and plan to never do busines with them again.
you've already stated that you verbally agreed to the deal. that's a contract, i believe, in most courts. you might have a prayer of avoiding the debt if you go to court and lie, but that might also set you up in a position of perjury. i think you are pretty much stuck with this debt.
i'm sorry i don't have something more favorable to tell you.
i'm sorry i don't have something more favorable to tell you.
Linda, just to throw one more piece of shrapnel into the grenade... I obviously didn't take the time to Google this - but didn't IndyMac go belly up in the last few years? If so, that means that your note has most likely been securitized. And if THAT is the case, it is also possibly true that whomever your note holder is has already received 100% of at least the face value of your note through various insurance policies that are put in place to cover RMBS trusts.
I haven't been able to pin this one down yet but from what I understand, "note insurance" is placed on RMBS trusts to cover losses. In essence, Linda, your note holder may have already been paid for the value of your note. I know it's not fair to throw an unsubstantiated theory like this into the mix but between the possibility of the existence of various insurance policies, potential CDS investments and/or market shorts that were potentially made, note holders in general may have already made upwards of 4-6x the value of outstanding notes. Whether this is true in your particular case, Linda would have to be found out through the discovery process during litigation.
You might want to consider asking them to produce your original note and prove that they have legal standing (per Article 3 of Uniform Commercial Code and whatever state equivalent may exist) to enter into an agreement with you, or foreclose for that matter, before you sign anything. If they balk at the suggestion or flat out refuse, you might want to consider speaking with an attorney.
I haven't been able to pin this one down yet but from what I understand, "note insurance" is placed on RMBS trusts to cover losses. In essence, Linda, your note holder may have already been paid for the value of your note. I know it's not fair to throw an unsubstantiated theory like this into the mix but between the possibility of the existence of various insurance policies, potential CDS investments and/or market shorts that were potentially made, note holders in general may have already made upwards of 4-6x the value of outstanding notes. Whether this is true in your particular case, Linda would have to be found out through the discovery process during litigation.
You might want to consider asking them to produce your original note and prove that they have legal standing (per Article 3 of Uniform Commercial Code and whatever state equivalent may exist) to enter into an agreement with you, or foreclose for that matter, before you sign anything. If they balk at the suggestion or flat out refuse, you might want to consider speaking with an attorney.