Disclosures on a short sale

[civilguy]

Well I was either going to just let my house go in foreclosure or short sale. My realtor has just informed me that we have a short sale offer on my house. My realtor wants all this financially sensitive information from me in order to submit a short sale package eg. banks statements, paycheck stubs, tax returns etc. I am one of those who have decided it is prudent to walk away from my mortgage even though I can afford the mortgage payments. My question is will there by any problems if I tell the bank I don't have a job and give them banks statements from another acct that i have that shows no activity. As of now I really don't care if the short sale goes thru or not since my loans are non-recourse (confirmed w/ a lawyer) and I'm thinking that I would be happy being a renter for the rest of my life so I really don't care about the credit hit or foreclosure mark on my record.

[The Professor]

I would suggest not providing inaccurate data. Better providing no data at all, but simply explain to your realtor, who can explain to the lender, that their promissory note is non-recourse and therefore you are presenting the short sale offer in a "take it or leave it" manner.

The fear in providing inaccurate information is down the road the lender may have a cause of action against you for being induced to enter into the sale based upon your insolvency. It just isn't worth the risk to fall into that potential trap. Additionally we are starting to see posts here that indicate there wasn't the great disparity between credit score reductions based upon short sales and foreclosures.

Daniel

[civilguy]

Thanks professor,

This makes sense to me. I'm starting to get the feeling that the short sale benefits the lender and my realtor. The lender gets part of the loan money back w/ no work or effort on their part, and my realtor gets a fat 40k commission check. Also the credit hit from the late payments has dragged my credit score down 150 points already so a foreclosure is just another inconsequential drop in points that won't matter for anything.

[NV702]

I brought this thread up from the past because I have a similar question. I am in Nevada and have my home listed in order to do a short sale. I dont feel comfortable disclosing my financials to the lender because I dont want to give them any leverage on me. I can afford to pay all the bills but with almost nothing left over each month. I filed jointly with my spouse and they will see that together we are doing okay but she is not on the loan or title. Point is, I am the only one responsible for taking on the loan, will the lender see her income as an asset even if she has no bearing on the loan? Her money is seperate from mine and it wouldnt make sense for the lender to assume that she is obligated to pay for my mortgage just because we are married. Am I paranoid or is this a possibility?

I really think there is no chance for a short sale due to having a weak hardship case. I am only doing it for the slim chance of a deed in lieu, since having the home on the market is a requirement.

[ORNV3]

I'm also trying for a short sale in Nevada but really have no hope. At first I was nervous about sending in all my info to the banks but I have nothing to hide and it will only show them that I have noting to give them at all. My goal is to get a short sale and be released from all debts. We'll see...

[dogatemy]

Originally Posted by civilguy

This makes sense to me. I'm starting to get the feeling that the short sale benefits the lender and my realtor. The lender gets part of the loan money back w/ no work or effort on their part, and my realtor gets a fat 40k commission check.

This is the reason I have not pursued a short sale. Why should I go through the trouble of helping my lender sell my house? If they treated everyone in these forums fairly then that would be one thing but right now I am simply angry. Cash for keys or i'm taking the ceiling fans..

[AZChick]

You are so right, why in heck should I send in my private documents to PROVE to the bank that I need to short sale my house. Look around, the banks know what's going on, our homes are worth a fraction of what we paid! Either they agree to do the short sale or they can simply foreclose. I'm not gathering a D*** thing to send to my lender to prove diddly squat. I've already taken my ceiling fans that I paid for....