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Bottom of an Approval Letter and what it means to the seller/homeowner

Posted by Freddie Castaneda on December 12, 2012 at 8:30am in Short Sale Discussions

I have a question at the bottom of an approval letter states: Important Notice Required by Law: Federal law requires us to notify you that (a) Lender is considered a debt collector, (b) this is an attempt to collect a debt and (c) any information obtained will be used for that purpose.  However, if you are currently in a bankruptcy, this letter is not an attempt to collect a debt from you personally to the extent it is included in your bankruptcy or has been discharged, but is provided for informational purposes only.

My question is does this mean that the lender cannot collect any monies from the seller for example for making up the difference on a second lien payoff amount???  For example the 1st only approves $3000 and the second is asking for $5000 and will not budge and is asking for the seller to come in with the difference.

Thanks in advance!

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Replies

  • Freddie Castaneda December 17, 2012 at 9:30am

    My apologies for not getting back to the thread...

    Thanks for the replies as it makes more sense now as to what the "Mini Miranda" actually means...

  • Smitty December 12, 2012 at 10:24am

    Wayne is right.  One has nothing to do with the other.  Every lender has that disclosure somewhere.  Many actually have a script that say that when you call in. 

  • Wayne Brooks December 12, 2012 at 8:56am

    The language in the approval letter states what That lender will accept, and the terms.  It has nothing to do with limiting monies required for other negotiations with other lien holders.

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