Home Equity Short Sale

I haven't been in the business of short sales long but this is the first I have heard of this and need to know the procedure so to speak.

I have a seller that called me saying he needed a short sale.  I asked all the typical questions to see if I could help him and the major one being what type of Loan did you get to buy the house.

He told me that it was a home equity loan as he and his wife bought the home outright and then a few years later borrowed against the house because of major financial and health issues.  

Is there a type of procedure for this type of short sale or anywhere around here I can look for information or just anyone who has dealt with this type of short sale before?  

Any type of help would be appreciative.  On top of this, it looks as though his HOA did a non-judicial type of foreclosure as well so I am positive there will be a second lien.

Help :)!!  Oh the bank is Citi Financial.  

Thanks, Brenda

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Replies to This Discussion

Permalink Reply by joe beauchamp on August 29, 2012 at 12:05pm

Home Eq's are different from each other - somewhat individual. Pretty much just think of it as dealing with many of the 2nd loans on a property.. I can't tell you about Citi, I'm not usually doing those in the office.

In general, you can expect it to be like any other loan - same doc's but with their own wrinkle, like any bank/loan/investor.

HOA's have a special status, sort of like township taxes. They aren't really in 2nd position. I don't follow all that closely - not sure what an HOA foreclosure means because they didn't take the property (by paying off the 1st) as a 2nd loan does to foreclose on a property, so I don't understand the point. They have special status to collect, then what is the diff between a lien from them and a foreclosure? As I said, I know there is something funky there, just don't need to follow it and so I don't. Would be curious if someone comes across this and wants to explain.  ;-)

Permalink Reply by Tara Samney on October 17, 2012 at 3:36pm

 I've successfully done HELOC short sales.  You just need to be careful you are forwarding everything to their HELOC dept, even if both loans are with the same servicer.  I've never done one with Citi- but shockingly got a deficiency waiver on one with Chase for over $50,000.

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