Short Sale in AZ

[MRC123]

We were thinking of walking here in AZ, but I think we just may do a short sale instead.

My questions:

During the short sale process, do we have to make payments?

Should we request a short sale package now that we are still current, or when it gets closer to the 90 days of not making payments?

At what point do we need to contact a realtor about listing our home as a short sale?

[faith]

Originally Posted by MRC123

We were thinking of walking here in AZ, but I think we just may do a short sale instead.

My questions:

During the short sale process, do we have to make payments?

Should we request a short sale package now that we are still current, or when it gets closer to the 90 days of not making payments?

At what point do we need to contact a realtor about listing our home as a short sale?

MRC123,
Hope all is well with you.
You need to hire a real estate agent and put your home in the MLS listing, check bbb search for a good agent near your home. You need to ask the real estate agent if he has experienced in Short Sale. You have to give a letter authorizing your lender to talk to your agent regarding your house and Short Sale.

Your agent will submit the Short Sale package for you. The lenders will only accept a Short Sale if the house is listed within 60-90 days, some lenders requires 3 months behind in payments so make sure you ask your lender about it. You have to write a financial hardship letter to your lender explaining in detail why you are doing Short Sale, they will ask 2 copies of pay stubs, 2 bank statements, your monthly expenses, maybe w2's for the last two years. You have to do it fast, right pricing is the key to successful Short Sale. Find out the selling prices in your area and beat that price to attract a buyer. For example, if the selling prices in your area is $200k, price it down to $180k to attract a buyer. Check realtors.com or zillow.com to get an idea of how much is the selling prices in your area. Without a buyer, your lender will deny the Short Sale.

I hope this helps.

God bless you and take care.


Faith

[Cali5]

Faith and Cat,

I am also planning on walking away in California since I am upside down $150K. I am so confused how to begin. I am 3 months late awaiting loan mod but I think I am going to walk away. Do I ask for short sale first? Our neighbor across the street was on short sale but now foreclosed, nobody bought the house. How long do they give you time to short sale before they foreclose. I am getting nervous. I have 3 small kids, I need to know when to start finding a place to rent. Will anyone let me rent their house since I have 90 days late on my credit report.

[faith]

Originally Posted by Cali5

Faith and Cat,

I am also planning on walking away in California since I am upside down $150K. I am so confused how to begin. I am 3 months late awaiting loan mod but I think I am going to walk away. Do I ask for short sale first? Our neighbor across the street was on short sale but now foreclosed, nobody bought the house. How long do they give you time to short sale before they foreclose. I am getting nervous. I have 3 small kids, I need to know when to start finding a place to rent. Will anyone let me rent their house since I have 90 days late on my credit report.

Cali5,
Hi, good evening, hope all is well with you.
It depends on who your lender is and how your lender handles foreclosure, deed in lieu and Short Sale. I was 8 months behind when Countrywide Home Loans approved the Short Sale. I have asked Countrywide Home Loans first for refinance, loan modification and to sell back the house to me at a Short Sale price of $290k, but CW denied all my request. I have moved out of the house while my credit was still good. We just checked our house 1 or 2 x a week.

I have hired a regular agent who did not have experience in Short Sale, though there were 6 buyers that made an offer all backout due to long process. The 2nd agent has experienced in doing Short Sale and in 1 week brought 4 buyers, I rejected the 4th offer being a very low offer, the first buyer backed out due to long process but the 2nd buyer made an offer more than the selling price in the amt of $298k to cover his closing costs.

Write a financial hardship letter to your lender, send copies of pay stubs, write down all your expenses and if the surplus is less than $100, they mightl approved your Short Sale, you need to send them your last 2 months bank statement also. If you are planning to do Short Sale, you better do it as soon as possible and proper pricing of your house will attract a buyer. If your neighbor or everyone in your area is selling their homes in your area for $200k, lower it down to $180k to attract a buyer. Without a buyer, there is no Short Sale, because lenders only approve Short Sale if there is a buyer.

As far as renting a house, make sure that you ask if the owner is not in foreclosure because I hate to hear you move to this new house and find out later that the house is in foreclosure process.

If you are planning to rent an apartment, now is the time to look while there's less damage in your credit. Just tell the landlord that your house is pending sale. Landlords need tenants too, some requires credit check, some don't, some requires a deposit of $400-$500 plus 1 month and 1/2 rent, so make sure you check. You can check rent.com or apartment.com for apartments near your area. Be careful giving money up front without seeing the place and without signing a contract. There's a lot of people out there who enjoys robbing you of your money they did not earn.

Hope this helps and God bless you.


Faith

[MRC123]

Can anyone provided more information on this information:

The Anti-Recourse only applies for a purchase money mortgage that goes into foreclosure. As long as you have the same mortgage you bought the house with and did not take out any equity, you should fall into this category.

However, we've been advised by our broker that this is not the case with short sales. Just because the bank may release the loan for less than is owed does not mean it has been forgiven. What some lenders are doing is removing the additional principal from these loans and then bundling them up and selling them off to investors. The investors who then bought the loans are going after the borrowers. There is a lot of litigation out there in regards to this.

It almost seems as though they leave you no choice but to foreclose. Any thoughts anyone??

[faith]

Originally Posted by MRC123

Can anyone provided more information on this information:

The Anti-Recourse only applies for a purchase money mortgage that goes into foreclosure. As long as you have the same mortgage you bought the house with and did not take out any equity, you should fall into this category.

However, we've been advised by our broker that this is not the case with short sales. Just because the bank may release the loan for less than is owed does not mean it has been forgiven. What some lenders are doing is removing the additional principal from these loans and then bundling them up and selling them off to investors. The investors who then bought the loans are going after the borrowers. There is a lot of litigation out there in regards to this.

It almost seems as though they leave you no choice but to foreclose. Any thoughts anyone??

MRC123,

I think Professor Shays need to give us advice on this one.

I've never heard of this one, Purchase Money Mortgage and Non Recourse Loans the lender can not pursue the homeowners for any deficiency judgment in CAlifornia or other non recourse states. That's why when you hire a real estate agent make sure they have experienced doing with Short Sale and they will negotiate to your lenders that your lender will not pursue you for any deficiency judgment and make sure that the Negotiator put that in writing and in escrow papers.

Thanks and God bless.

Faith