Short sale question

[swamp]

The money goes to the bank. Is the husband on the deed? He'd have to sign too.

It is not legal or ethical to "sweeten" the purchase price. When you sell, you need to sign papers showing the purchase price.

[Rocky Mtn Saver]

It would seem to me that the way to answer that is to know why the woman doesn't want to sign.

[swamp]

Is there a written purchase offer? If yes, sue her for specific performance. If no, nothing.

[Opti]

I'm wondering sign what? The short sale has to be approved by any banks involved along with the owner(s). Depending on the state and the shortfall the homeowner could have tax liability.

Just because it is a short sale doesn't mean the seller is required to accept any and all offers. The bank certainly will not.

[midjd]

With a true short sale, the bank can't come after you for the difference between the sale price and the loan amount. In recourse states, a foreclosure allows the bank to collect the balance.

There is not much difference between them on a credit report (score-wise, at least). Both will cost you about 150 points.

[Tiny]

Nov 12, 2012 20:09:59 GMT -5 Opti said:

I'm wondering sign what? The short sale has to be approved by any banks involved along with the owner(s). Depending on the state and the shortfall the homeowner could have tax liability.

Just because it is a short sale doesn't mean the seller is required to accept any and all offers. The bank certainly will not.

With a short sale the seller does have to approve the bid. A reason for them to balk at doing this (and to make it hard for people to get into the house to see it) would be that they can prolong the time they are living in the house without paying anything towards the mortgage/taxes.

The short sale house I put in a bid on has been owner occupied for the last 2 years with not one mortgage payment made. They may have screwed themselves over though - if that tax break on mortgage forgiveness amounts doesn't continue past Jan 1. They will then most likely have to go the foreclosure route... maybe that's their ultimate plan. They've got a roof over their heads with out much need to move or pay for it.

And yes, the seller did have to sign stuff (disclosures and some other papers) before my bid could go to the bank. It took some cajoling from my real estate agent and the attorney handling the sale for the sellers to first let me in to see the house and then to get the papers signed. I'll probalby have to wait for hell to freeze over to hear from the bank at this point - it's so close to Thanksgiving - I suspect not much work is gonna get down between now and the first week of Jan 2013.

[haapai]

Actually, a couple of years ago we were hearing about short sales in which the seller agreed to pay the shortage. But even in cases like that, it is usually in the sellers' best interests to accept the short sale offer as long as they have somewhere to go.

A short sale solidifies the amount of the loss. The seller does not have to worry about the bank letting the property rot. They don't have to worry about getting dinged for what vandals and squatters do. They don't have to worry about the property being assigned to a crooked, or overwhelmed, or incompetent listing agent who makes no attempt to sell the property while it deteriorates.

ETA: a bit more knowledge regarding the foreclosure process in the relevant state might serve you well. In some states, the process can take a very long time and a seller agreeing to a short sale is surrendering several months of shelter. In other states, a bank could repossess this house pretty quickly.

The realtors in question are probably barred from disclosing much of anything.