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  Wendy Cutrufelli April 21, 2010 at 6:38am

  I'm not certain what state you are in but if in CA, I would exercise caution in suggesting they sign the deficiency waiver without attorney's counsel. In some cases, even if a refinance, the sellers may NOT have a deficiency under the Merger of Interest Rule. Not common but hugely important for those that have the scenario. If they sign the doc allowing B of A to pursue in the future, they are accepting a future deficiency that they may not need to incur.
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  Bill Schallmo April 19, 2010 at 6:25am

  Most of the asset managers and short sale negotiators work from a preformatted guideline script. They are paid based on the percentage of the debt they recover. Remember these are not loan originators, but debt collectors. Their entire goal each day is to get their name up on the big board in the office and move on to the next file. Basically, they DO NOT care about your file. That being said; if signing the note (deficiency judgment) gets the file closed, do it!
  
  There’re are only 2-banks that require deficiency judgments; Bank of America and WAMU (now Chase). BofA’s settlement letters come out of their legal department and they will include the verbiage that they: “do reserve the right to collect” on the remaining balance.
  
  They will try and collect on the second, but after 4-years we have not had any of our clients’ with 1st T.D.’s have any collection activity. Basically, take the deal and have your client’s negotiate with them on reducing the amount owed after they get the deal closed. This option is better than the foreclosure on their record.
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  Bryant Tutas April 16, 2010 at 1:09pm

  Perfect thought process Kathleen. I tell my sellers before I even list their property that a short sale is not a free walk in the park. They may have to pay income taxes and they may very well have a judgment filed against. They may also have to bring cash to closing and sign a promissory note. I place these disclosures in writing and they sign off on it as part of the listing agreement.
  
  If they say they don't want any of these things to happen then I suggest they make their payments. It's simple.
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  kathleen shaffer April 16, 2010 at 12:56pm

  my feelings exactly. i cannot believe how much information is spewing out on the internet, in offices and by people who are not licensed to practice law.
  We all know, that the second can file a DJ. We also know that the borrower can claim insolvent, bankruptcy whatever......but, they do it at their own risk, not at my suggestion.
  I will stik to my original plan of "You decide what you want to do Mr. Seller" (I don't even refer attorneys anymore)
  Thanks Bryant......
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  Bryant Tutas April 16, 2010 at 12:49pm

  Kathleen. I would NEVER give this kind of advice to my seller.This is beyond the scope of what we as agents and brokers do. If the seller has any concerns at all about this they need to seek legal advise.