For a little background history, US Bank holds both our primary and secondary (line of credit) loans.
From the start of the process, our attorney/realtor/ourselves assumed (wrongly) that since US Bank held both loans that our short sale paperwork would cover both. We recently found out that this is not the case and that we have to submit all of the paperwork to another default resolution department within US Bank.
The purchase offer that we received is enough to cover our primary mortgage, but not enough to cover the second + commission fees. Basically all along it is the line of credit that needed the short sale and not the primary mortgage.
Recently we received a letter from USBank that they will give the second lein holder 10% or $3000 whichever is less. Also stated is that a lein release from the second lein holder is required before the short sale will be approved.
Even though both loans are with US Bank, it seems like we still have to handle the process like they are two different companies. Just does not make sense.
Anyway when I called to follow-up to find out what paperwork was needed for the line of credit short sale, I was told that we would have to sign a deficiency letter for the balance that we would still owe. The person I talked to said they would not release the lein without this.
Has anyone had any luck being able to get the lein release on the second mortgage without having to sign the deficiency judgement? The line of credit was setup originally when you were able to get 80%/20% loans.
We are working with a real estate attorney to help us through all of this.
Ultimately if we have to pay whatever the difference is, I'm really wondering now if it makes sence to have gone with the short sale in the first place.
Thank you in advance for any advice/comments!
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I think some of it has been that we were not asking the right questions. I'm in Minnesota and have asked if we are a non deficiency state or not.
When my ex-husband called the bank he had to ask to talk to a supervisor to get anywhere in the discussion to find out what we needed to do.
What he was told though is that US Bank is not doing HAFA yet until Aug. We started the process in mid-April with the assumption that it was eventually going through HAFA. At that time we received a letter from USBank that outlined all of the records that we had to send them including our hardship letter. That letter was dated April 23rd and we sent everything in around May 17th. We received an offer on Jun 14th.
We finally received another letter from US Bank on June 24th that the request had been received for the short sale review. We were told that this would take another month for the short sale review. The BPO was just done yesterday.
So it *seems* like we're moving ahead other than for the 2nd lien gotcha. I have a feeling that we really wouldn't have been able to do much with the 2nd lien anyway until now though.
I just don't understand why it took so long for US Bank to turn our file over as a short sale from when the information was first received. We asked for the short sale from the get-go so why did it have to take a month go through the initial look through to say 'yes this is a short sale'.
Just a little fustrated with the bank, but I know that I'm not the only one sharing this fustration.
I just received an approval letter from US Bank. I must say they were wonderful to deal with even thru a few buyer cancellations. The approval letter is great BUT...I am concerned and have advised my seller to consult an attorney, because it says NOTHING about a Deficiency. It does NOT say that they reserve the right to pursue a deficiency judgement and it does NOT say that they Waive the right for a Deficiency judgement.
This is an original, single loan, owned by Freddie. Any thoughts or concerns about the lack of language on the approval?
Elise Fay
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