SS denied due to Aurora thinking there's not a hardship!

The sellers bought near the top of the market, then got transferred so in order to get a new home in their new area they took an equity line out on the house we are now trying to short sale. The market plummeted so they took it off the market (3 yrs ago) and rented it out. The tenants just moved out and we placed it back on the market to short sale as the sellers didn't want to rent it out anymore. Aurora has the first, Wells the 2nd. The sellers borrowed money from their parents to keep up the payments on both loans during our short sale negotiations; offer came in over Thanksgiving and was submitted. Since then we have been told during each call (2x every week!) that the file in "in process" and "I should hear from a negotiator soon". As of Dec 30 that was the last communication until on Jan 5 the sellers get a denial letter dated Dec 31 stating that there wasn't sufficient hardship due to the fact that the payments were current. (when they asked me whether they should keep making payments I of course told them to contact an attny or CPA.) The sellers have called and called to no avail as have I. They are told that they need to wait 60 days and then reapply and NOT make payments!!! (I wonder what would happen if an attny got to litigate THIS case!) Right now Aurora is only short by $35000!!! I'm just amazed they denied this! The 2nd (Wells) is short about $250000!

Does ANYONE have a supervisors name/email/phone that I can take this to?

Any and all help will be much appreciated!

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Replies to This Discussion

Permalink Reply by Wendy Rulnick on January 15, 2011 at 1:12pm

Gael - Some investors have the "missed payment" criteria. If you can show "imminent" default, you might be able to get around it. If not, keep the buyers on the line, wait, and resubmit after the seller misses a payment.

Permalink Reply by Malcolm McLean on January 15, 2011 at 5:03pm

Gael - this property will be seen as an investment property - you should make the sellers aware that both Aurora and Wells Fargo will issue either a deficiency condition and/or a 1099.

I'm sure the CPA or attorney they contacted would have told them this information(?).

Does the new home have equity?

Permalink Reply by Gael Adair Grove, CDPE/SFR/ePro on February 13, 2011 at 6:26am

hi,

just an update...due to Julie, managment email given on here, she escalated it, we are reopened, having to resend and update all the package, and NOW waiting for Wells to give an answer to the 6k offered by Aurora for Wells' 2nd....

Permalink Reply by Kimberley Kelly on February 19, 2011 at 7:32am

I hear over and over about how Sellers can do a Short Sale and still keep their mortgages current, which of course, they do to protect their credit. I ahve NEVER gotten a Short Sale approved while payments were current. Am I the lone wolf here?

Permalink Reply by Gael Adair Grove, CDPE/SFR/ePro on February 19, 2011 at 1:23pm

another update............we have APPROVAL!!!

and no....I have never had a short sale approved when sellers current (altho all my short sales before this one the sellers have been behind before we start the process).

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