Replies to This Discussion

Permalink Reply by Aimee Hall on January 27, 2011 at 12:08pm

YES,  I am currently working on a Short Sale with Nationstar.  They asked the BUYER to supply them with a one page financial statement as well. I expressed  that the BUYER had already provided them a pre approval letter from BOA but they insisted that if the sale was to go forward the documentation had to be provided. It does not seem right but the BUYER complied....

Permalink Reply by Bill Garrett on January 27, 2011 at 12:46pm

I have seen this one other time.  It was on a fairly recent file where I was dealing directly with an investor (IMPAC). Once IPMAC learned we had a "cash buyer" the negotiator immediately dropped the demand that the buyer apply with them  for a mortgage.

 

I presently have a new file with NationStar where NationStar professes the same requirement that the buyer apply with them for a mortgage.  I'm wondering if a little push back will cause them to drop the requirement.  I know the buyer is not at all pleased with this demand.

 

Your legal theory is interesting but my instinct is that by it being a short sale trumps those concerns. The lender is not obligated to approve a short sale, as we all know too well. 

 

This buyer mortgage application condition is, however, a bit of a stretch.   I've seen it rationalized that it assures the lender that the buyer is truly credit-worthy, and that the transaction is indeed arm's length.

Permalink Reply by Wendy Rulnick on January 27, 2011 at 1:27pm

Richard - What is "alienation of title"?

Permalink Reply by Richard Zaretsky on January 28, 2011 at 6:12am

Wendy -

Alienation of Title - this is the ability to transfer the title of a property.  There are consitutional and common law rules that prohibit acts that prevent the alienation of title without consent from the (encumbered) owner of the property.  In the case of a mortgage, the borrower agreed to the restriction of alienation of title if the mortgage says it is not transferable and must be paid in full upon the transfer (alienation) of the title.  So in a short sale there are some interesting issues in this regard.

 

Regards, Richard

Permalink Reply by Wendy Rulnick on January 29, 2011 at 3:39am

Richard - Thank you so much for that definition! 

Richard Zaretsky said:

Wendy -

Alienation of Title - this is the ability to transfer the title of a property.  There are consitutional and common law rules that prohibit acts that prevent the alienation of title without consent from the (encumbered) owner of the property.  In the case of a mortgage, the borrower agreed to the restriction of alienation of title if the mortgage says it is not transferable and must be paid in full upon the transfer (alienation) of the title.  So in a short sale there are some interesting issues in this regard.

 

Regards, Richard

Permalink Reply by Shayna M. Bechtel on February 15, 2011 at 9:15am

I was able to get written confirmation today that CASH buyers do NOT have to fill out the application. 

Permalink Reply by Bobbie Files on March 4, 2011 at 2:22pm

I have had NationStar waive the application for a cash buyer too.  They did want 2 different verifications of the funds. We gave a bank statement and a letter from a branch manager confirming.  However, they will not waive it in my experiences for a non-cash buyer.  I honestly do support it.  It ensures us agents that we will have a close when the short sale is approved.

Permalink Reply by Eva Aliaga on March 17, 2011 at 5:59pm

I have a short sale with Nationstar (was 1st with SunTrust) scheduld to close on March 31, 2011. Have an approval and buyer was not asked to fill anything out from Nationstar, she is going FHA.