Benefit of giving cash contribution if they won't write off deficiency?
I am in middle of negotiating a second with MI involved through BOFA. First is also BOFA. They wanted $5000 CASH and $5000 promissary. We negotiated out the promissary. So now $5000 cash only. However, they will not satisfy the lien. My sellers are enlisted military who were forced to move and tried renting and making up the $500/mo difference til they have nothing left to give.
What is the benefit to them to beg, borrow $5000 to make this short sale happen?
Input please! Thanks.
Replies to This Discussion
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Permalink Reply by Kent Dills on
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Kathy, was this a VA loan by any chance? If so, go directly to the VA with your impassioned and reasonable argument!
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Permalink Reply by Kathy Batterton on
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No..don't I wish! AND they missed HAP eligibility by 15 days! AND we spent 5 months in HAFA and never got an approval.
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Permalink Reply by joe beauchamp on
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OK, I called several times and cust svc at BofA assured me that there was no MI on the 2nd yet the team lead (and negotiator clone) insisted that the MI wanted this money. I'd be curious if you have the same ripoff pinhead Tom T. involved.
Think about it, what insurance co. would insure a 2nd? What kind of premium would have to be charged for a loan that can disappear in 3 seconds? HUGE, right? Who would do that? Nobody - it is a lie. There is no MI on the 2nd. BofA people have been taught to talk up how big and bad MI is and then "oooooo, they want a zillion dollars and you'd better listen."
The negotiator will refuse to give you the MI (call cust svc, innocently ask for the MI and see what you get for the answer). If you are ticked, take it to the next level. Get full name and ID, tell them that they are criminally violating truth in lending and that YOU are the authorized representative for your seller and that their name is going to the D.A. for criminal action. Get his supervisor, same thing. Another level or two and that person will understand and know that you are serious and can, indeed, throw them in jail for such a fundamental violation. BofA does illegal things all the time. This is one of them. How do you (the seller) know that this negotiator doesn't just want an extra $5K for his uncle louie? He wants you to write a check with a blank name because he won't tell you who the MI is? Duh, can he spell truth in lending? How about jail?
Usually, my sellers do a poor job of filling out both financial info and hardship info. I beat them over the head and get the real answers. That usually makes a big difference. If there is an MI, they will see that your seller is saying he makes $2K more per month than he spends or he has no liabilities (BofA asks for assets, they don't want to hear that the seller has liabilities). You have to check the bank statement for funny transactions. They also check the credit report to see if other payments are on time, bought a new car and on and on.
If it is a negotiator sleaze ripoff, they are generally too lazy to look at much of anything and you can ask him to point out all this extra money that the seller has (to which he will answer that he doesn't know, it is that mean bad ol' MI doing it, not innocent him).
The note can be good - you are changing a $100K debt or whatever for the $5K note to be paid off at 0% interest and $50/mo for 100 months. That doesn't sound bad. And, if you do a BK, the note goes bye-bye.
Go oil up your guns and get in there with the financial facts of your seller and blow their shoes off. Demand to talk to the MI, who is it. They will absolutely refuse to tell you - primarily because it doesn't exist - they are LYING.
Call cust svc first, see what they say about the MI. Are you sure? No MI on the 2nd, OK, thx... I would not tell them where you got the info - you don't want them going back to tell cust svc to shut up. Do not get off the phone until you have gone up the chain - you hang up, you start all over. Let them know that they aren't dealing with some pansy realtor who will faint at the sound of one more "I'll transfer you to". Get name & ID at every step if you are going in for serious name-taking.
Hardship letters are more important than you might think. Bank people love to read that the seller has suffered.
So, do your homework, clean up the seller's hardship letter, make sure that the financials are correct (extra $2K a month - oh? where are they putting that extra $2K? None? then it isn't right and extra $2K/mo debt - how is that getting paid if there is no income or savings to pay it - something is funny here).
Then let them know that there is no money for this greedy negotiator, they are broke, they have no $5K and if you have something good about where their last $$ went, it wouldn't hurt -- stick it to that negotiator.
Don't forget that if you are in the right area for the payoff to the investor, that you should use both feet on his neck with how you should talk to the investor - the money is there for them and "someone" is playing games to gouge for money that isn't there. When this goes to foreclosure, the investor is going to have the facts that you offered enough for them but "someone" kept pushing for more that wasn't there and destroyed the short sale.
The only other way that I can think of hurting the negotiator, off hand, is to somehow confiscate his bags of donuts - that would really hurt, no? ;-)
Go get 'em! -
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Wow! I will definately let you know where this one ends up.
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Permalink Reply by Stephanie Hart CA 310-930-2342 on
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How did this end. Having same deal on a BOFA 2nd. They purchase MI on most loans they take over. My sellers never agreed to it.
I verified it through the MI dept at Bofa. Mine is with Old Republic. You can call the MI dept to verify MI is in fact in place.
Kathy Batterton said:Wow! I will definately let you know where this one ends up. -
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$2500 cash contribution, but didn't have to be from sellers. BUT we already cut commission to 5%. When the HUD was re-done with taxes paid, the seller only needed @$220! Whew! BUT still did not waive deficiency.
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well thats goo:) Were a non deficiency state in CA. Glad yours closed!!!
Kathy Batterton said:$2500 cash contribution, but didn't have to be from sellers. BUT we already cut commission to 5%. When the HUD was re-done with taxes paid, the seller only needed @$220! Whew! BUT still did not waive deficiency. -
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