Credit Unions and Deficiency Waivers?
Hello Everyone, I'm new to your group, but have been selling/working short sales for about 4 years now with a fairly successful closing percentage, but have not had one with a Credit Union, until now.
The experience in the first 10 days has been unusual to say the least. It is Central Florida Educators Federal Credit Union. On my first contact, that were extremely agressive and hostile and basically said that they flat out do not waive deficiencies, unless it is a HAFA. They have to protect their "members" funds, blah, blah, blah. I'm not sure who regulates these folks, if anyone, but if the Nat'l Mtg. Bankers Assoc. stats say a bank loses, on average, about $40,000 additional when they foreclose vs. allowing a short sale, why would a credit union think their resale experience would produce different results? Asumming that they really do not get different results, then how would the additional $40,000 loss "protect their members"?
Within hours of my phone call, which they chose not to "record for accuracy", they reached out to the borrower, with another hostile and agressive call, also not recorded, and told them they did not qualify for HAFA, so they better pay or "else"!!
Has anybody out there dealt with these "thugs"? Or others of the same ilk? Any tips would be appreciated.
J Scott Jones - GRI reMBA CREX CDPE - REALTOR - BROKER - INSTRUCTOR
Replies to This Discussion
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Permalink Reply by Smitty on
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I haven't dealt with that specific credit union, but I find about 50% of the credit unions I deal with are EXACTLY like that. Again it depends on who the investor of the loan is. MANY credit unions portfolio the loans, so they aren't sold on the secondary market, meaning, they are kept in house. So they call the shots. I am dealing with one in Rhode Island and they flat out said the homeowners were responsible for the balance before we even started the sale. I don't particularly like this, but it is what it is and at least going in, we know what to expect.
Oh, and I would STILL try to negotiate it out if it is at all possible. Most lenders respond to $$$.
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Permalink Reply by Wendy Rulnick on
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I have found many credit unions are inexperienced with short sales. Try to gently lead them.
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Permalink Reply by Sherri Bright on
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Hello J. Scott,
I have had success gaining waivers of deficiency with Florida credit unions, however it has come at the cost of high cash contributions and/or promissory notes sometimes both. This would include both portfolio and investor loans. Especially when the CU's see the default as more strategic than hardship.
Just keep trying, as Wendy suggests be gentle:)
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