Just received an approval from Wells Fargo it seems they now have new verbiage which states, "With the exception of a Home Affordable Alternative (HAFA) closing, nothing in this Demand Statement or in the release of the mortgage shall waive the right to seek a deficiency under the loan documents or any of its other rights there under, and the obligations evidenced by the note shall remain in full force and effect until paid in full."
Seller refuses to close unless we obtain a "FULL WAIVER OF DEFICIENCY"!!! I called the Final Negotiator and requested such, however, she told me this is the new language and not her nor her supervisor or anyone else for that matter can change this verbiage; WF legal department is aware of this. Is there anything that can be done????????????HELP!!!!!!!!!!!!!!!!!!!!!!!! In the meantime we have an approval but the seller will not proceed!!!!
Any suggestions will be greatly apprecaited!
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I would not close until they put the waiver of deficiency in writing (or the seller accepts the risk in writing). period.
Has anyone seen any softnening on Wells Fargo's recent deficiency stance? As it stands, I have yet to find an example of them waiving deficiency on anything other then Fannie/Freddie, govie and HAFA.
Any feedback would be appreciated.
Wells Fargo approval dated today states "Compliance with this Demand Statement coupled with release of the mortgage shall waive the bank’s right to seek a deficiency under the loan documents or any of its other rights there under, and the obligations evidenced by the note."
Thanks for the feedback...by any chance, do you know if the loan was owned by Freddie or FHA/VA or if it was an outside investor?
I just reviewed Freddie Mac Bulletins through 2012-13, dated June 13 and can find no change in the policy of waiving deficiency stated in 2012-5. I'll be getting an approval letter some time next week (we're going back and forth on price and terms now); anyone have any updates to Wells' position on this?
I have attached the bulletin that addresses the requirement to waive deficiency
Freddie Mac Deficiency bulletin.pdf
Hey Lisa,
I got this response back from my law firms negotiator. Please tell me if you have any advice or next steps I should take.
I received our "non-approval letter" from Ocwen this morning. And I called in to clarify and confirm the reason for the decline. The max allowed for junior liens is $6,000. Because there is also an HOA amount due of $580.00, it exceeded the max of $6,000. If we would resubmit a revised HUD reflecting $5,420. to the 2nd and $580. to the HOA, it would be approved.
But, the more important thing I confirmed this morning is that there will be no extra contribution allowed at closing, unless Ocwen was to receive it. So, since the 2nd/ASC will not accept $6,000. and will only accept the full $15,000. to be paid at closing and not a partial payment beforehand, as Bret had hoped, this will not work.
I will ask the 2nd /ASC once more regarding Ocwen's final decision. Only if ASC will accept $6,000. at closing will this work for us.
Once I know more regarding ASC's decision, I will contact you
Are you in a Super Lien State? If so, the HOA would be a sr lien, not jr lien, correct? If you are not in a super lien state, then you should be able to negotiate a discounted payoff to the HOA. Also, I have always been able to get the lenders to approve HOA fees from buyer, seller, agent or a combination if they do not allow from sales proceeds.
I would revise the HUD to get the 1st lien approval letter and then work on the 2nd, ASC / Wells Fargo. Send the approval letter from Ocwen to Wells Fargo. Until you have something in writing that the first lien has agreed to short sale, the 2nd will keep dancing trying to get more. AND then there is the deficiency issue.....
Lisa, How can I get updated Bulletin's from Freddie Mac?
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