My fiance and I both own a home. We can afford both mortgages right now, but would like to sell her condo so we can consolidate bills, start a family, etc. We met with a real estate agent yesterday who said that our situation was not a valid reason for a short sale. We still have all our money separate, so it would just be her financials they look at (I assume)
The biggest issue we have is if we have to come up with say $10K that might be doable, but if the shortfall ends up being more than that, not sure we could swing that kind of money
I could have sworn I read were our situation was a valid one, but the agent seemed to say unless we could prove that we couldn't make the payments, there was no way we would even be considered for a short sale.
FYI- the mortgage is through Mass Housing if that makes any difference
Thank you everyone in advance!
My first reaction was you'll just have to bring the balance to closing, but I'm not sure. Your best bet is to call MA housing and ask a representative. Then call back the next day and ask someone else, because you very rarely get the same answer twice. By the third call, if you have gotten the same answer, you'll know if you can go forward with the sale or not, but again, my knee jerk reaction to someone that states "we can afford both mortgages" is that you'll have a MUCH more difficult time than someone who truly has a hardship.
This should be no problem. It's all how the deal is presented to the lender. PM me for more info.
Joseph, as this is a learning site, why don't you share how you'd approach this?
Trade secrets ;)
basically though, it gets down to tough negotiating and will involve some sort of cash contribution. The object is to get it as low as possible.
First of all, you said Fiance. That means your assets are not merged together. Are you counting your income and her's together- to afford the payments? Not counting yours...how would the situation change?
I say put the house in the market and see how much will be the short fall ( after getting an offer), then talk to the lender about how much you can contribute ( if you chose to contribute towards the shortfall ) I'm sure they -lender-will seriously look at it and work with you.
If the lender does not work with you- another option for you will be to keep the condo and rent it out to generate income. Wait till the value goes back up- while the tenant take care of the mortgage payment.
NEVER talk to the lender about what you can contribute. Why would you open that can of worms? Let the lender issue the approval and see what the terms are. negotiate from there.
good point- see first how much exactly will be the short fall and go from there...
Correct, our finances are totally separate for now. Because the house was only in my name, I assumed we would have to disclose my income when she did her finacial statement, is that not the case? Can she claim both payments using only her income?
I was under the impression we had to list the property as a short sale, is that not the case? Like I said we could probably come up with $10K at closing, but anymore would be very tough
We thought of renting, but neither one of us is very handy to fix things, plus we would likely lose $400/mth doing that
Income is only for the person names on the mortgage, so no, we would not count yours, or your assets. We would, however, count total household expenses.
I would never volunteer your cash contribution, but it could be useful later on. My strategy is to let the bank tell us terms, then negotiate. So, if the bank came back and demanded $10,000, more than likely we could throw $1,000, maybe $2,000 and they'd take it and release deficiency and run.
Most MLS services now require a short sale to be labeled as such.
Currently working on one now where Wells Fargo will not even go that far as presenting terms. No current or imminent hardship, No Approval.
After careful review, we are unable to approve your request for short sale due to our investors guidelines. Management review of the file has confirmed the borrowers do not meet the investor’s guidelines for short sale consideration. The above request has been removed from short sale review at this time.
yes I have seen that too. Usually a revised hardship letter with some additional documentation will work. There is a certain WF investor that requires a delinquency as well.