How favorable are most lenders to letting willing sellers sign promissary notes if not delinquent?

I know there are more details to a short sale consideration however, I'm in a situation where the seller was not delinquent at the start of the short sale request process and wanted to sign a promissary note on the 2nd which is also with the same lender. I'm just curious to find out the favorability of such a transaction with most lenders.  I am the buyer and remains somewhat out of the loop in this transaction.

 

I have since learned that the seller has missed 1 payment.  However, to my knowledge the seller still has a job and should be able to make payments.

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Permalink Reply by Bryant Tutas on August 7, 2011 at 12:31am
Putting this in the newsletter today
Permalink Reply by Richard on August 7, 2011 at 8:10am
Thanks Bryant!  I appreciate it!  This site is an invaluable resource for rookies and vets!
Permalink Reply by Karyn samuel on August 7, 2011 at 4:46pm

I had the buyer in a similar situation. Both loans in my case were with Chase.  The Seller, a physician, had relocated to another town and could not sell his old residnece.  Chase allowed the short sale on both liens and the 2nd loan, instead of insisting on a PM, asked for under 6k contribution from the seller.  The seller gladly paid it at closing.

The 1st loan asked for nothing.

I think the answer to your question depends on the lender and what the situation with the seller is.  In my case, the seller had relocated and was not coming back, so maybe that's why they allowed it?

Permalink Reply by Richard on August 8, 2011 at 6:39am

Hi Karyn,

 

Thanks for the advice!  The reason I ask, the seller in my short sale transaction is in a similar situation.  Except, she's with Charles Schwab the investment bank.  I think what may be complicating my case is a divorce about 4-5 years ago where she got the house.  In just wondering in this this case if the lender is looking for money elsewhere; especially if they can track his and her finances through investments with them. 

This may explain why the lengthy approval process which is at 5 months already.  And, me being the buyer I have no insight into what's actaully stalling the process.  I'm not sure that she can make a real strong contribution at this point, however I estimate that something in the order of 6-10k is small compared to the actual 2nd note.

Now I'm also wondering if MI is involved and causing a problem.  MI and/or tax liens were never mentioned up front as was the 1st and 2nd in our negotiations.

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