I went to a Short Sales & Tax Implications seminar presented by a real estate attorney and was advised that in the state of FL waiving the deficiency judgment does not preclude a bank from attempting to
recover balance owed. Unless the approval specifies no deficiency judgment on the mortgage and note the investors can still collect on the note. While the deficiency may have been waived on the mortgage the instrument is just collateral for the note; therefore, the promise to pay as agreed to on the note
itself can still be called due. In essence, the borrower could potentially receive a 1099 and still have a deficiency judgment. Has anyone else heard of this?

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I thank you for taking the time to reply to our concern however we are located in Kissimmee Florida and the letter I got was given to me through my Realtor it is from the financial Vericrest it is a letter of short Sale acceptance and the house we own is only worth$ 60,000.00 and we still oh over $172,000.00 which there is a big negative the man who is buying the house is buying cash and his driving from Virgina and I was very clear to my Realtor that we will back off the deal if we do not get a forgiveness letter or a letter Wipe off letter at the table the same day of closing. We will walk away if we don't see the forgiveness letter which would be the first thing my husband and I will be looking for. The other Realtor said that the letter I get is the one of the Short sale and I know better then that and i explained to her I have nothing future to say other then those will be the paper we will be looking for. The letter I have is only a letter from my Financial which is Vericrest Financial and in one part of the letter it says the contract sales price shall not be less then $60,000.00 another part reads: The seller's settlement charges to be withheld from the net proceeds check shall not be greater than $4,240.00. The sellers settlement charges include $1,200.00 for HOA, $0.00 for buyer Credit. in another part it reads the net proceeds check Vericrest at closing shall not be less than $52,985.24 any additional fee/Cost assocaited with the sale must be negotiated among and paid for by the seller, Buyer, and/ or real estate agent in number 4. says the actual payoff due through the anticipated close of escrow date is estimated at $120,066.00 the payoff includes unpaid balance.then  when I read number 8. Vericrest will release its lien upon the property onces all conditions of the letter are satisfied.VERICREST WILL NOT PURSUE A DEFICIENCY JUDGMENT ON THE DEFICIENT BALANCE....WHICH NUMBER 8. IS THE MAIN QUESTION I HAVE IS IT saying there not pursue a deficiency judgment on the balance am I good to go on closing or after the sale there going to hit me with the different like they do other people then number 10 says there may be tax consequence as a result of a short sale or negotiated payoff. You are encourage to contact a tax professional to identify any tax liabilities you may have then the far end of the letter reads THIS IS AN ATTEMPT BY A DEBT COLLECTOR TO COLLECT A CONSUMER DEBT AND ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE WHAT CAN YOU ADVISE US ARE WE SAFE TO CONTINUE WITH THE CLOSING OR SHOULD I BE EXPECTING A LETTER OF FORGIVENESS OF DEBT OR WIPE OF AT THE TABLE JUNE8 I THANK YOU FOR HELPING US AND GUIDING US THE WAY GOD BLESS AND THANKS A MILLION..<3

Paul Antonelli said:
  I can understand your concern, I deal with this every day. The approval letter you got from the bank, was it presented to you by an attorney? Are you in Florida? You should also have been given another paper that says M.A.R.S. somewhere on the top. That should say that you are not bound and do not have to accept the settlement if your not happy. If your in Florida and all this was done, then feel assured that your agent is compliant. If you need an attorney to ask about your approval letter let me know. [email protected]

Maria said:

Hi we are going to go to closing June 8, 2011 I am not getting a great vibe with the fact were almost to closing and all I got was a letter of approval for the short sale in the letter it says  vericrest will release its liens upon the property once all conditions of this letter are satisfied . Vericrest  will not pursue a deficiency Judgment on the deficient Balance am I safe to sgin on closing or what....we made it clear to the Realtor who is sailing the house that we want a letter black and white saying forgiveness of debt or a wipe of he says this is the letter of forgiveness and I do not feel he is being honest of course at the end of the day he makes his commission and we end up screw over so can anyone advise he what should I be looking for at closing cause the first thing I said I want to see is the letter of forgiveness or wipe of and if I don't see either one we will walk away and not close but the person who is buying my house is coming from Virgina and he sold all his stuff and pack what he is to carry with him  and I do not think it would be fair i walk away and not sign after the man drove miles so before he makes his step I would like to be guide now what it is still time I don't want to lost neither do I want the buyer to lose and to have him travel so far would not be fair for him nor us.Is it true the 1099 C I do not receive till the new year in the beginning of Jan or Feb what is it you know that can help us make  the right decision I came across this page and I know it was God who guide me cause i was just preparing myself for a preaching. So your in put is very important and thanks for your help.. God Bless



Cindy Kidd said:



Paul Antonelli said:

   What he is saying here is common knowledge. If an approval letter has no line about Full Waiver, then the lender has secured it's rights to seek a judgement within 5 years. 

 The investor is bound by what the servicer does and agrees to. If your approval letter does not include the verbage :Full Waiver" then go back. Tell them you can not have your seller sign and agree to such an open ended approval.  And then you want the 1099C, with this the lender/investor can not collect anything else. That would be double dipping and it is illegal for the lender. If you get the letter and it says 1099A or just 1099, you need to tell them it needs to say 1099C.

I thank you for taking the time to reply to our concern however we are located in Kissimmee Florida and the letter I got was given to me through my Realtor it is from the financial Vericrest it is a letter of short Sale acceptance and the house we own is only worth$ 60,000.00 and we still oh over $172,000.00 which there is a big negative the man who is buying the house is buying cash and his driving from Virgina and I was very clear to my Realtor that we will back off the deal if we do not get a forgiveness letter or a letter Wipe off letter at the table the same day of closing. We will walk away if we don't see the forgiveness letter which would be the first thing my husband and I will be looking for. The other Realtor said that the letter I get is the one of the Short sale and I know better then that and i explained to her I have nothing future to say other then those will be the paper we will be looking for. The letter I have is only a letter from my Financial which is Vericrest Financial and in one part of the letter it says the contract sales price shall not be less then $60,000.00 another part reads: The seller's settlement charges to be withheld from the net proceeds check shall not be greater than $4,240.00. The sellers settlement charges include $1,200.00 for HOA, $0.00 for buyer Credit. in another part it reads the net proceeds check Vericrest at closing shall not be less than $52,985.24 any additional fee/Cost assocaited with the sale must be negotiated among and paid for by the seller, Buyer, and/ or real estate agent in number 4. says the actual payoff due through the anticipated close of escrow date is estimated at $120,066.00 the payoff includes unpaid balance.then  when I read number 8. Vericrest will release its lien upon the property onces all conditions of the letter are satisfied.VERICREST WILL NOT PURSUE A DEFICIENCY JUDGMENT ON THE DEFICIENT BALANCE....WHICH NUMBER 8. IS THE MAIN QUESTION I HAVE IS IT saying there not pursue a deficiency judgment on the balance am I good to go on closing or after the sale there going to hit me with the different like they do other people then number 10 says there may be tax consequence as a result of a short sale or negotiated payoff. You are encourage to contact a tax professional to identify any tax liabilities you may have then the far end of the letter reads THIS IS AN ATTEMPT BY A DEBT COLLECTOR TO COLLECT A CONSUMER DEBT AND ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE WHAT CAN YOU ADVISE US ARE WE SAFE TO CONTINUE WITH THE CLOSING OR SHOULD I BE EXPECTING A LETTER OF FORGIVENESS OF DEBT OR WIPE OF AT THE TABLE JUNE8 I THANK YOU FOR HELPING US AND GUIDING US THE WAY GOD BLESS AND THANKS A MILLION..<3

Maria said:
I thank you for taking the time to reply to our concern however we are located in Kissimmee Florida and the letter I got was given to me through my Realtor it is from the financial Vericrest it is a letter of short Sale acceptance and the house we own is only worth$ 60,000.00 and we still oh over $172,000.00 which there is a big negative the man who is buying the house is buying cash and his driving from Virgina and I was very clear to my Realtor that we will back off the deal if we do not get a forgiveness letter or a letter Wipe off letter at the table the same day of closing. We will walk away if we don't see the forgiveness letter which would be the first thing my husband and I will be looking for. The other Realtor said that the letter I get is the one of the Short sale and I know better then that and i explained to her I have nothing future to say other then those will be the paper we will be looking for. The letter I have is only a letter from my Financial which is Vericrest Financial and in one part of the letter it says the contract sales price shall not be less then $60,000.00 another part reads: The seller's settlement charges to be withheld from the net proceeds check shall not be greater than $4,240.00. The sellers settlement charges include $1,200.00 for HOA, $0.00 for buyer Credit. in another part it reads the net proceeds check Vericrest at closing shall not be less than $52,985.24 any additional fee/Cost assocaited with the sale must be negotiated among and paid for by the seller, Buyer, and/ or real estate agent in number 4. says the actual payoff due through the anticipated close of escrow date is estimated at $120,066.00 the payoff includes unpaid balance.then  when I read number 8. Vericrest will release its lien upon the property onces all conditions of the letter are satisfied.VERICREST WILL NOT PURSUE A DEFICIENCY JUDGMENT ON THE DEFICIENT BALANCE....WHICH NUMBER 8. IS THE MAIN QUESTION I HAVE IS IT saying there not pursue a deficiency judgment on the balance am I good to go on closing or after the sale there going to hit me with the different like they do other people then number 10 says there may be tax consequence as a result of a short sale or negotiated payoff. You are encourage to contact a tax professional to identify any tax liabilities you may have then the far end of the letter reads THIS IS AN ATTEMPT BY A DEBT COLLECTOR TO COLLECT A CONSUMER DEBT AND ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE WHAT CAN YOU ADVISE US ARE WE SAFE TO CONTINUE WITH THE CLOSING OR SHOULD I BE EXPECTING A LETTER OF FORGIVENESS OF DEBT OR WIPE OF AT THE TABLE JUNE8 I THANK YOU FOR HELPING US AND GUIDING US THE WAY GOD BLESS AND THANKS A MILLION..<3

Paul Antonelli said:
  I can understand your concern, I deal with this every day. The approval letter you got from the bank, was it presented to you by an attorney? Are you in Florida? You should also have been given another paper that says M.A.R.S. somewhere on the top. That should say that you are not bound and do not have to accept the settlement if your not happy. If your in Florida and all this was done, then feel assured that your agent is compliant. If you need an attorney to ask about your approval letter let me know. [email protected]

Maria said:

Hi we are going to go to closing June 8, 2011 I am not getting a great vibe with the fact were almost to closing and all I got was a letter of approval for the short sale in the letter it says  vericrest will release its liens upon the property once all conditions of this letter are satisfied . Vericrest  will not pursue a deficiency Judgment on the deficient Balance am I safe to sgin on closing or what....we made it clear to the Realtor who is sailing the house that we want a letter black and white saying forgiveness of debt or a wipe of he says this is the letter of forgiveness and I do not feel he is being honest of course at the end of the day he makes his commission and we end up screw over so can anyone advise he what should I be looking for at closing cause the first thing I said I want to see is the letter of forgiveness or wipe of and if I don't see either one we will walk away and not close but the person who is buying my house is coming from Virgina and he sold all his stuff and pack what he is to carry with him  and I do not think it would be fair i walk away and not sign after the man drove miles so before he makes his step I would like to be guide now what it is still time I don't want to lost neither do I want the buyer to lose and to have him travel so far would not be fair for him nor us.Is it true the 1099 C I do not receive till the new year in the beginning of Jan or Feb what is it you know that can help us make  the right decision I came across this page and I know it was God who guide me cause i was just preparing myself for a preaching. So your in put is very important and thanks for your help.. God Bless



Cindy Kidd said:



Paul Antonelli said:

   What he is saying here is common knowledge. If an approval letter has no line about Full Waiver, then the lender has secured it's rights to seek a judgement within 5 years. 

 The investor is bound by what the servicer does and agrees to. If your approval letter does not include the verbage :Full Waiver" then go back. Tell them you can not have your seller sign and agree to such an open ended approval.  And then you want the 1099C, with this the lender/investor can not collect anything else. That would be double dipping and it is illegal for the lender. If you get the letter and it says 1099A or just 1099, you need to tell them it needs to say 1099C.

Maria, similar to what Bryant and Amanda said above, with a short sale you are reducing your liability and possibly eliminating it NOT SO with a foreclosure.

It appears that the deficiency is being forgiven which is what you want BUT you are posting bits and pieces of the letter and peppering it with your own comments and not breaking it down in paragraphs making it a bit hard to read and understand.  ASK an attorney to interpret it for you, it may cost you $200 or so to do but you would at least know for sure or ask your real estate agent for guidance.  

I know that what you are going through is very stressful, just take a deep breath and try and sort through all the information you are being presented with.  Also, go back and read the first two lines of this post.

The above is not intended to be legal advice.  I am not an attorney and do not play one on TV.

 

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