Short Sale rent backs are a great solution for a lot of people, but a lot of banks have you sign an "Arms Length Affidavit" that doesn't allow it. From reading through some comments, it looks like some banks allow it, and some don't. I thought it would be usefull to start a thread where everybody can post their past experiences with certain banks, and post whether each bank allows them or not. The one I am dealing with now is Wells Fargo and I have found that they do not allow it. I hope we can make this a nice reference point that we can all share!
Good idea Eric. This far I haven't run across any that would allow a rent back.
So far I have only seen Wells Fargo not allow seller rentals. My team has a cash investor pool that is very interested in Seller Rent Backs. We are now comparing payoff approvals and probing different banks for answers. When I have that list I will gladly share it. I am curious to see who else has any knowledge about this...
I tried for a very long time to modify the loan with BOA. Finally, out of money, I just resorted to short sale. The interesting thing is my modification would only have saved me a minor amount of money for a whole lot of credit damage.
Sean Wilder said:
I have only heard of this with foreclosed properties and deed-in-lieu's. I do know that it is actually illegal in some states, though more research would be needed to confirm which states. Check your own states first. There have been a lot of scams involving rent backs in the past couple years so they are frowned upon in a lot of states. That being said, I think it is hilarious that some of the investors would rather take the loss and let the seller rent it back, when they could have just modified the loan.