Short Sale/Foreclosure question

[SD Realtor]

As far as being under water with regards to the home being less then the mortgage balance… Hmmm… I would say at least 50% of them if not more. Yet they all were quite educated in the sense that I gave them my personal views on the market.

As far as not being judgemental I am way past that. Long ago I had decided that 95% of our population were morons so whether we call it poor judgement, stupidity, foolish behavior… it is all the same to me. I am not so sure I agree with playing the card that they were not real estate experts so they could not envision the crash. Bottom line is they did what they did because they were allowed to, encouraged to, prodded to by our society and our government.

The few people who did not fall into the trap are the ones who simply thought, “what if” and/or “maybe I shouldn’t buy something I cannot afford”. Rightfully those that stayed in thier means were smart. Wrongfully they thought they would reap severe benefits but all they got out of it was a nice savings pad that is slowly whittled away by inflation as well as an incredibly poor rate of return.

[jonnycsd]

Regardless of how you “feel” about the situation, the equity loans will be full recourse against the borrower. Many lenders will “get what they can” in a short sale, then pursue the seller for the deficency balance. Tactics include wage garnishments and leins against any assets they can find.

The “non-recourse” loans mentioned in an earlier post only apply when the loan proceeds are used to purchase or improve (renovation or additions) the property.

This borrower is not out of the woods yet.

[jonnycsd]

Regardless of how you “feel” about the situation, the equity loans will be full recourse against the borrower. Many lenders will “get what they can” in a short sale, then pursue the seller for the deficency balance. Tactics include wage garnishments and leins against any assets they can find.

The “non-recourse” loans mentioned in an earlier post only apply when the loan proceeds are used to purchase or improve (renovation or additions) the property.

This borrower is not out of the woods yet.

[jonnycsd]

Regardless of how you “feel” about the situation, the equity loans will be full recourse against the borrower. Many lenders will “get what they can” in a short sale, then pursue the seller for the deficency balance. Tactics include wage garnishments and leins against any assets they can find.

The “non-recourse” loans mentioned in an earlier post only apply when the loan proceeds are used to purchase or improve (renovation or additions) the property.

This borrower is not out of the woods yet.

[jonnycsd]

Regardless of how you “feel” about the situation, the equity loans will be full recourse against the borrower. Many lenders will “get what they can” in a short sale, then pursue the seller for the deficency balance. Tactics include wage garnishments and leins against any assets they can find.

The “non-recourse” loans mentioned in an earlier post only apply when the loan proceeds are used to purchase or improve (renovation or additions) the property.

This borrower is not out of the woods yet.

[jonnycsd]

Regardless of how you “feel” about the situation, the equity loans will be full recourse against the borrower. Many lenders will “get what they can” in a short sale, then pursue the seller for the deficency balance. Tactics include wage garnishments and leins against any assets they can find.

The “non-recourse” loans mentioned in an earlier post only apply when the loan proceeds are used to purchase or improve (renovation or additions) the property.

This borrower is not out of the woods yet.

[SD Realtor]

Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller.

[SD Realtor]

Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller.

[SD Realtor]

Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller.

[SD Realtor]

Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller.

[SD Realtor]

Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller.

[urbanrealtor]

[quote=SD Realtor]Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller. [/quote]

On this specific topic, I just had a conversation with a short sale negotiator who kept insisting that the loan is full recourse. As long as the seller does not sign paper converting the deficiency balance can be turned into an unsecured note, the seller should be able to claim that the short sale is the conclusion of the debt and that the remaining debt is discharged. This advice is from counsel.

[urbanrealtor]

[quote=SD Realtor]Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller. [/quote]

On this specific topic, I just had a conversation with a short sale negotiator who kept insisting that the loan is full recourse. As long as the seller does not sign paper converting the deficiency balance can be turned into an unsecured note, the seller should be able to claim that the short sale is the conclusion of the debt and that the remaining debt is discharged. This advice is from counsel.

[urbanrealtor]

[quote=SD Realtor]Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller. [/quote]

On this specific topic, I just had a conversation with a short sale negotiator who kept insisting that the loan is full recourse. As long as the seller does not sign paper converting the deficiency balance can be turned into an unsecured note, the seller should be able to claim that the short sale is the conclusion of the debt and that the remaining debt is discharged. This advice is from counsel.

[urbanrealtor]

[quote=SD Realtor]Actually we are starting to see cases of what were originally classified as recourse loans indeed not going against the borrower. Some courts have found negligience (perhaps rightfully so) with the lending institutions. Furthermore don’t think for a moment that policy cannot change. If you think that these policies are indeed static you are sadly mistaken. Finally most all short sales now involve more then one mortgage. In these cases the second lien holder is usually out of luck and they know it and they release the lien without a formal note from the seller. [/quote]

On this specific topic, I just had a conversation with a short sale negotiator who kept insisting that the loan is full recourse. As long as the seller does not sign paper converting the deficiency balance can be turned into an unsecured note, the seller should be able to claim that the short sale is the conclusion of the debt and that the remaining debt is discharged. This advice is from counsel.

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