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Don't be baffled. Just qualify her as you would any buyer. She may not know what she is doing. Just because she is trying to pursue a short sale for her current residence doesn't mean she will get it approved. I've worked with a couple where one spouse was going through a short sale and they purchased a new home less than a mile away. Only one was on the mortgage. By the way, a year later the 2nd home owned soley by the husband foreclosed. In any case, if she qualifies to purchase a home in your state, find her a home!
Good luck to you!
Coleen,
I just had a converstion with a homeowner/broker who is putting her home up for short sale next weekend. The For Sale sign is already in place. She gave me all the details I needed today in conversation. But originally, I talked to the husband yesterday and he informed me that they are walking away from it. It's a very nice home. However, they are a month away from having another home completely built less than 5 miles away.
They have a 1st, 2nd, and MI on it with B of A. The short sale package hasn't been prepared or filed yet but, she feels very confident that she's going to be able to short sale it. According to her timeline, the short sale home will be ready to take possesion in mid-October. She's already lined up a negotiator. This is all in the same state.
Hmmmm........but what do I know?
I think that you are assuming too much. Don't assume that she has a hardship and don't assume that her credit is bad. She could be a strategic defaulter or she could have a transfer that forces her to move. Maybe her short sale is such that she is willing to sign a promissory note or bring cash to the tabel to satisfy it.
Sell her a home, if she qualifies, why do you care what she is doing with her current home?
Ha-ha..I'm with you Jeff. You're not handling the short sale and I think many Lenders just don't want another foreclosure to deal with..who the heck knows????
Brian is right about FHA allowing upside down owners to buy & we should all keep in mind if this is a transfer or relocation (it was an out of state buyer) that FHA allows you to short sale & then buy immediately there after if the short sale was caused by the change in work & you've had no late payments in the past 12 months & you are current on your existing loan.
It doesn't have to be fraud nor should you assume that. You are not helping her sell short- so don't get involved in that part of it, Focus on what she is asking you to do. Get her qualified with a great lender & make sure she told the lender what she is doing so there is full disclosure & no surprises. If she qualifies great- sell her a home.
Coleen,
You've received some great answers here however I'd like to make another point to consider.
As others have said, it really doesn't matter what this "buyer" is doing with their former home - or does it????
You have been told they are short selling their house and buying another - what you do not know is whether they are buying with their short sale lender's knowledge and "ok". Obviously no one should assume anything about what anyone's situation is - but if it turns out that it is a Buy and Bail without the lender's knowledge and approval - it could be considered "Fraud for Housing" / "Fraud for Profit". The best thing to do is ask them to put their exact situation and intentions in writing and have them sign it - you can then choose whether to participate in their situation or not.
Always remember to abide by Fair Housing. Consult an attorney.
Best of luck,
Thom Colby
Broker
Newport Beach CA
Is it possible that she will complete the short sale without missing any payments? If so, and if she has good credit otherwise, she'll be able to buy a home just after she sells.
Maybe she just needs to wait until after the short sale is complete. She obviously hasn't missed any payments yet or she would not be able to qualify for a new mortgage right now. I have a BOA Co-Op short sale about to close (no missed payments) and one of the sellers will be buying within 3 months of closing on their short sale.
Good Luck!
I can hear it now.....
"Your Honor, they told me they were selling their current house as a short sale and we needed to get this new house closed before their credit was ruined, I didn't think anything was wrong with that... I was only doing my job, I'm just trying to earn a lilving."
We all need to be careful in what we choose to participate in. Here in Orange County, CA the District Attorney has established a Housing Fraud Division full of attorneys and investigators specifically to find these type of activities and they have engaged many Realtors to assist them in discovering agents who might be knowingly (or unknowlingly) participating in Housing Fraud. I know it is also happening in Houston and several other cities around the country.
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