Hi everyone, love this site, has helped so many times-- need your help!!

I rep the buyer. Original short sale approval was to close July 10th, but we didn't get letter til July 6th so needed extension. Just got new short sale approval yesterday (August 21!!) to close August 30. No problem. EXCEPT the buyer's lender is unhappy because both the 1st and 2nd's short sale approval are on the same letter. Basically, the 1st's account number is at the top of the letter, and in the body of the letter it says the 2nd will be paid $6000. Chase owns the second as well. Seller's SS negotiator says that should be enough to discharge both liens from the title report, but buyer's lender is saying that they need to see either another SS approval for just the 2nd or two account numbers referenced on the letter. 

Have any ideas how to work around this? We have requested a revised letter from Chase, but if it takes another month, it's going to get ugly!!

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  • It is the consensus that you need that 2nd letter or so reference to it, but it's Chase that said they would take care of it. So I am wondering if that's the trend and how do you work with that. I am thinking now the question is: how do I get that 2nd account number added to the letter in short time? My buyer signed loan docs-- just need it as a funding condition.

    • Like I said .. you have a letter from the 1st agreeing to pay the 2nd $6,000.   Now you need a letter from the 2nd agreeing to accept $6,000 as a pay off.  It does not matter that they are the same bank and that 'logic' tells you that it should be assumed.

      • If both loan numbers are on the first payoff, it is complete and that is all you need.

  • It sounds to me like you have an approval letter for just the first that approves PAYING the 2nd $6,000.  However, that does not sound like the 2nd has ACCEPTED $6,000.  You need written approval from the 2nd.

  • Weird. I had a 2nd approved a few months ago with Chase and they had their own separate letter. About a year ago, I had the 1st and 2nd with Chase and they had 2 different letters.

    I guess things are changing all the time.

  • I have always gotten these closed by having title company insure over the second lien.  They will do this as long as approval letter is for 1st and 2nd with same lender.

    • OK, could you elaborate a little how to do this? Forgive my ignorance. 

  • I think the buyers lender is correct. The 2nd needs to be referenced in the payoff either by account number or separate letter. I would check with the closing agent and see if what yo have is good enough to give clear/insured title. If it is then have then put it in writing and see if this will work if for some reason Chase will not give what you need.

    • Brian, when you say closing agent, you mean on our side, not the bank's, right? She has already determined that a 2nd letter is required. The short sale negotiator on our side says that it isn't. So I am just trying to workaround!

      • The closing agent that is insuring the title from the seller to the buyer. They will not provide title insurance without a clear payoff that acts as an estoppel letter. 

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