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Short Sale of Deceased....

Posted by Krystal Lee Whaley on March 10, 2011 at 10:14am in Short Sale Discussions

In California...I am getting more and more of these.

 

I have one trickier than normal......the wife is a survivor on the title, but not on the Bank Loan. The husband whom is deceased is the only one on it.  My Probate lawyer friend said there is really nothing to Probate about that since California is a community property state.....

My problem is the Wells Fargo is insisting on some kind of legal paper that the wife can control his finances...there was no will and of course the deceased can't sign an auth....

 

anyone run into this?

 

Please Advise...Thanks

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Replies

  • Krystal Lee Whaley March 14, 2011 at 5:38am
    Thanks every1 for the input!
  • Paula Cotton March 13, 2011 at 11:01am
    Your client should definitely consult with the estate attorney and should also consult with a real estate attorney and a CPA. I had this happen with a client that was the representative for her mothers estate. She let it go to foreclosure because it would have created a taxable event for her if we had short sold the house since this was not her primary residence.
  • Alan Remigio March 13, 2011 at 4:32am

     I am not an attorney. However, I've run into this situation several times with estates pending probate. If there is an attorney that is handling the deceased's estate, it's a simple matter of having the survivor being assigned by the court as administratrix or executor of the estate enabling the survivor to conduct a wrapup of contractual obligations that did not involve her. With that document they can now conduct business and resolve possible pending actions against the deceased. That doc can be given to the bank involved and move the property to resolution.

  • Penny Alper March 13, 2011 at 3:03am
    I had the exact same scenario with Citi. They initially gave me all kinds of grief but I kept calling back until I got someone with a brain. Ultimately all I had to provide were a death certificate and a copy of the deed showing the wife as owner. It was the quickest and easiest short sale I've ever done!
  • Chris Shoemaker March 13, 2011 at 1:36am
    I had a short sale where the property was a condominium, the husband died and was the only one on the mortgage.  The wife had control of the estate.  We did a short sale rather than having the wife walk away because she couldn't sign a deed in lieu but didn't want to vacate the property and go through the lengthily foreclosure process (6 months) in Michigan.  This saved having the pay the association dues and utilities until the property went back to the bank.  It was with Citi and other than the first BPO being WAY too high (a condo? how hard is that!?) the closing went smoothly.
  • Wendy Rulnick March 10, 2011 at 3:35pm
    I can see the estate having to pay debt, but not a spouse who is not on the mortgage.  Would like an attorney to pipe in, too.
  • Bryant Tutas March 10, 2011 at 3:27pm

    I have. My seller decided to just walk away from the property. She was elderly and there was really no need for her to do anything. She wasn't on the loan. So she just moved on wit her life.

     

    So I guess my question would be what's in for the seller to go through a short sale? Why bother with the aggravation.

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