This IS a tough question to answer for a homeowner. A few things should be addressed. With short sales, banks will ask for the borrowers financials. This is a normal part of any workout routine, short sales included. If, by analyzing these documents, it is determined that the homeowner has the capacity to make the normal mortgage payments but they chose not to, the bank may be turned off from granting the short sale approval. We get into the area of “strategic defaulters” which just rubs all lenders the wrong way. More often than not, the lender may grant the short sale approval with the condition that a sizable cash contribution be made as part of the agreement. In lieu of the contribution, lenders may demand the seller sign a promissory or soft note for the remainder of the balance (or some negotiated amount). In the end it is the homeowners decision to make by considering what is best for their situation.
Kevin and Fred talk about the sticky subject of should homeowners miss payments.
I love you guys. thanks for keeping us all up to speed on what is going on in your business.
You got it Becky…=)
Mr. Weaver…that’s funny!
Great info as usual. I like the interview format. you are not both speaking at the same time.
Keep up the good work.
This IS a tough question to answer for a homeowner. A few things should be addressed. With short sales, banks will ask for the borrowers financials. This is a normal part of any workout routine, short sales included. If, by analyzing these documents, it is determined that the homeowner has the capacity to make the normal mortgage payments but they chose not to, the bank may be turned off from granting the short sale approval. We get into the area of “strategic defaulters” which just rubs all lenders the wrong way. More often than not, the lender may grant the short sale approval with the condition that a sizable cash contribution be made as part of the agreement. In lieu of the contribution, lenders may demand the seller sign a promissory or soft note for the remainder of the balance (or some negotiated amount). In the end it is the homeowners decision to make by considering what is best for their situation.