Short Sale Offer

Timothy Jones

LoanSafe Member
Jul 16, 2014
I just received this offer from my bank through my real estate agent:

$178K Loan Balance
$13K in payoff interest and other fees
$191 Payoff

$127K Offer from buyer
$10K Agent Fees
$11,400 Paid by me to Mortgage Insurance Company in form of a mandatory 0% interest, 10 year loan

From the top of the offer:

Important: Acceptance of $117,355.91 (the "Short Sale Amount") does not negate Bank's right to a deficience balance. The Bank retains the right to pursue the deficience balance, and SCCU reserves the right to collect and file suit for any outstanding deficiency balance.

The real estate agent says that the Bank will forgive the deficiency, but there's nothing about it in the language. I'm trying to decide a reasonable counter offer that includes language about waiving the deficiency.

I wonder if I should contact another experienced agent to review the documents for a fee. There's not much legal information included, so I don't know if I need to hire an actual attorney.



LoanSafe Member
Jul 31, 2014
My counter?

$117,335.91; waive deficiency; no promissory note. Tell them you will vandalize the house if they don't take the deal. IT MUST BE IN WRITING. Your agent is lying to you.

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
Southern California
Yes, the agent is straight up lying to you. They just want to make a commission. I have seen countless people sued for a deficiency even after their agent promised them they wouldn't.

What happened with this?

Timothy Jones

LoanSafe Member
Jul 16, 2014
I responded to the Bank Agent via email that "I would not sign any offer that does not specifically address the deficiency judgement and that I'm not taking a loan from the PMI company."

They quickly replied:
1. Stating that they could not change the terms of the offer in any way
2. Stating that they were going to begin the Foreclosure Process
3. Attached a formal "Short Sale Denial Letter" which states that the request for a short sale is now closed

I'm a little surprised that they are so willing to lose the current buyer unless this is just a scare tactic to get me to sign the deal. Is it possible that the bank would PREFER to Foreclose than Short Sale?

What's the reason for a loan with the PMI company? Why not ask for cash? They specifically said I could not bring cash to closing.