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Sorry Kynse, read it too fast. YES, I have this happen on 2 occassions, BUT both occassions were of different situations. Do the homeowners own another home?
Reason why I ask is this? 1 of my shorts, similiar situation, 2 mtgs, and the 2nd made the homeowners take out a "note" they called it, for 20 or 30 years. Low low payments, like $85/month or something, interest free. The sellers agreed. They did. They did not a foreclosure, as he was a prominent public figure in town, BUT he had moved from the home and purchased another home in the meantime, then tried doing short sale on his previous residence, Therefore, the bank held him under a barrel.
the 2nd situation was this, OH! and this is yet another blog...i am finding that these 2nd homes, the investment properties that people own, i.e. bought a house for my son and his wife and they didnt pay, or we didnt have a mtg so we took out a line of equity to put a down payment on another home.. well, LOE, LOC, 2nd homes etc...lenders are making the sellers carry notes for the deficiency. You dont find out until
1) the BPO is accepted
2) the short is approved
3) the buyer is ready to close
OH! Now subject to the seller signing this note. I've had lenders call my homeowners and tell them to get a hold of their realtor to do a short sale, "we'd rather do short sale than foreclose" YES, THAT IS BECAUSE THEY FOUND OUT THAT THE SELLER/HOMEOWNER HAS ASSESTS THEY CAN ATTACH THIS NOTE TO! OR if they default on the very small note they make them take out, they can attach it to their other property then.
I have been tricked on occassion, the sellers have been lied to.
Therefore, one short fell through and the home is going to foreclosure, if it dont make it to tax sale first, and the seller is filing BK on the house. Here was her BK attorneys advice to her.
GOT IT!!! HE SAYS TO TELL THE LENDER TO 'PRODUCE THE ORIGINAL NOTE' . HERE IS THE VERBIAGE.
"I suggest that you advise 5/3 that you will not sign the note for the deficiency. Having not seen the note and mortgage, I am not sure if it was originally signed as a non recourse or recourse obligation. Anyway, they should make the deal without your commitment to pay the difference. You will only be doing THEM a favor if you sign the note without getting anything in return. Let's see what they say because you will be discharging any deficiency of a foreclosure sale in the bankruptcy"
KEEP US POSTED.....THESE ARE SO CHALLENGING, AND FUN, DONT GIVE UP!
I got a full release from the lender! It took a lot of time and energy but I was successful!
I will post both letters the lien only and the full release on the Wilshire page. I also got an email from the supervisor stating that no deficiency would ever be pursued!
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