Replies to This Discussion

Permalink Reply by Joe Green on November 3, 2011 at 2:33am

I hope I don't sound heartless, but why wouldn't the seller agree to a promissory note?  They are typically 0% with a long pay back period.  If they are not willing to take on some of the burden then why not go to foreclosure.   Do sellers feel a sense of entitlement?  Maybe we should qualify our short sale listings to say up front "Are you willing to do a promissory note to settle the debt? or are you prepared to go into foreclosure where it's on your record for 7 years"

Permalink Reply by Jerry Robertson on November 3, 2011 at 2:41am

It was not about the money on that side. It was the monthly reminder of a really bad divorce that he was resisting. He offered them $3000 cash.

Emotions drive a lot of what we do in a situation like this and I understand. He may reconsider and we have talked a lot about all this. Next round might go better but I am looking for input so thanks for responding.

Permalink Reply by John Treadwell on November 3, 2011 at 2:43am

I have to say  Joe is right!! have they lived in the house while doing the short sale?  Then they have the money.   I don't like Wells Fargo short sales ,but from the ones I have done when they ask for money or a note they have found the sellers has funds somewhere.

Permalink Reply by joe beauchamp on November 3, 2011 at 4:11am

I'm interested in this topic because I don't get many Freddie SS's.  FNMA does not demand money from sellers.  BOA does all the time, but that is just them gleefully sucking any blood left from wherever they can - that isn't the investor.

Is Freddie the same way?  Or do they actually demand seller participation at times?

Banks/investors which demand seller money and refuse it from buyer, etc., are NOT doing so to minimize loss - they are clearly doing so to inflict pain on the seller.  It is just one of those things that I hate about banker mentality - money isn't fun unless you can make someone hurt, too.  Anyway, FNMA doesn't do that, does Freddie?

I rarely have a problem pointing out financial reality to the negotiator - in almost every case, they have not even done a cursory look at the financials and hardship info I have submitted (and bank statements, etc.). Now, if your seller is like a lot of mine, you have to beat him into giving you the correct financial info.  I get a lot of almost blank financial forms returned by the seller.  Then I can spend a long time explaining that the bank is making a financial decision and if they really don't want to bother putting in the electric bill, etc. and want the bank to see that they are making $3K/mo more than they are spending, don't be surprised when the bank will come back and ask for that mythical $3K/mo to go to them.

Is your seller the same?  Why does the negotiator think he has money now and that he will be making a profit after dumping this property?  Is it because that is the case?  Been paying off all his credit cards, just not this house payment?

This is either a case where you have a poorly documented financial situation, a seller quite capable of making one or the other payment or the negotiator/investor being sadistically punitive.  Each suggests a far different path.

 

[Oh, and realize that if the seller goes with a note, at some later time, he can approach the bank with "I won the lottery and thought I'd pay off the note with $6500 now for the $9K remaining in my 5 yr note" and get a discount on that.]

Permalink Reply by Kathleen Couch on November 3, 2011 at 5:44am

I am in Ga. so we use closing attorneys.  Those that have been educated in short sales, (or their paralegal) do it this way.  The final HUD after closing will have on it on line 1403 or close, this explanation.

(To Wells Fargo $3,000 POC)  Do not extend this to the columns.  I am assumining that $3,000 from the first is being given already, so the $3,000 outside of closing will come to what they want.

Then ask Wells Fargo if they want their money in a separate check or will take it all in the wire.

If they want it from the seller, and the buyer is willing to give the seller the cash or check (not in the loan). Then it can be designated as from the seller on the HUD, but POC (paid outside of closing)

Neither the first or second has bulked about this at closing.

Usually Wells Fargo does not do the second in Equator.

This isn't legal advise, but what has worked in this situation.  You will have to check on the closing attorney, or title company for your area.

I hope this helps!

 

Permalink Reply by Gael Adair Grove, CDPE/SFR/ePro on November 3, 2011 at 5:45am

hi,

I just had a doozy of a short sale close with the help of this gentleman! He's wonderful!

[email protected]

 

 

Permalink Reply by Jerry Robertson on November 3, 2011 at 8:35am

Thanks. Do you mind if I use your name?? I won't unless you tell me I can :) Sounds like he was a good guy but I don't want to presume on your relationship in the deal.

Permalink Reply by Gael Adair Grove, CDPE/SFR/ePro on November 5, 2011 at 8:21am

I asked him if I could refer him to others and he said it was ok so go for it!!

Permalink Reply by Eileen Johnson on November 3, 2011 at 9:20am

 

Hi Jerry,

If you or your borrower have provided Wells Fargo with documents that show he has the ability to pay a note or come up with the amount requested you may be out of luck with regard to this short sale. If your seller has demonstrated to Wells Fargo that he is unable to pay, and the negotiator is telling you that Freddie Mac will not approve the short sale unless he does, my suggestion is to call the Freddie Mac Borrower Support department at 800-373-3343, Option # 2. They will give you their email address to send your Wells Fargo 3rd party authorization so that you may speak to them on your borrower's behalf.

I closed a short sale in February of this year where Freddie Mac was the investor and Chase declined the buyer's offer saying that Freddie Mac would not accept it even after I provided Comps,and the negotiator told me "Freddie Mac knows how to read the MLS also" and that Freddie Mac reviewed the comps that I sent Chase and declined the offer! I Had the buyer get a certified appraisal showing the comps, sent that to Freddie Mac with a copy of the offer and told them that Chase declined the buyer's offer and closed the short sale. I got a call from a rep at Freddie Mac who told me he had the offer and the appraisal reviewed and that he contacted Chase Executive Services and advised them that Freddie Mac approved the offer and gave me the name and contact phone # to contact at Chase and we were able to get the short sale closed.

Eileen Johnson

Permalink Reply by joe beauchamp on November 3, 2011 at 9:43am

Good to see - so, Freddie Mac takes their job seriously, unlike FNMA - good info - thx.

Permalink Reply by Lillie Handy Dominguez on November 4, 2011 at 6:09am

Wells Fargo Bank

 

@Ask_WellsFargo

Try this on Twitter.  It's their help department.  Not sure if it'll work.  I just tweeted the.

Good luck.  I also emailed several executives this am.  No answer yet.