I have a short sale with two US Bank loans. The first is with US Bank Home Mortgage, which apparently is wholly separate from their Heloc division (which governs the 2nd). The 1st goes the traditional route (bank statements, paystubs, tax returns, etc.). The 2nd, however, insists that in order to review the short sale, they only want a HUD. But they also require the owner to agree to repay the entire deficiency in an unsecured note..or they won't even consider the short sale.  They also will require 10% or $5k, whichever is greater, from the 1st.

Our client owes about $125k on her 2nd, which means she'd have to get US Bank Home Mortgage to kick in $12,500, with the seller agreeing to cover the remaining $112,500 in a promissory note. If the seller doesn't agree to that up-front, they won't even look at the short sale (they bluntly said, don't bother sending us the HUD, because we won't look at it unless the seller agrees to pay the full deficiency).

Based on this bizarre policy, it would seem that we're dead in the water before we start. I'm sure others have encountered this, but not sure what the best next step is. I believe all the escalation contacts on the US Bank page are probably from US Bank Home Mortgage and not their separate Heloc division.

Suggestions? Advice? US Bank (Heloc) Contacts? Thanks in advance.