Not once, not twice, but three times before noon today the phone rang with a call similar to this:
Me: Thanks for calling Thompson’s Realty, home of the most kick-ass real estate brokerage in Phoenix! (OK, that’s not really how I answer the phone, but I’m considering it…)
Caller: I’d like to short sell my home. Can you help?
Me: Maybe! How far behind are you in your payments?
Caller: Oh, I’m not behind at all. I just want out.
Me: So, you’re not having any problems making your mortgage payments?
Caller: Oh no, no problem at all. In fact, I’m pre-approved for {insert amount here ranging from $150K – $385K} and am looking for a new home.
Me: The bank won’t approve a short sale unless you can demonstrate a hardship – you have to prove to them you can’t make the payments.
Caller: {stunned silence} Well, that’s not fair! My home isn’t worth what I’m paying on it! They have to let me sell it short!
Uh, no they don’t.
And from here the calls diverged. All three asked me if they should just walk away from their homes. (Yeah, like I’m going to advise someone to default on their mortgage.) Two seemed to eventually understand why banks and lenders can’t just let anyone who feels like it sell their home for less than what they owe on it. One caller was adamant that I didn’t know what I was talking about, insisted that no lender could tell him what he could do with his house (newsflash buddy – your lender has a lien on the home. It’s really theirs, not yours) and said he’d “find someone with a clue” to help him.
Whatever.
Here’s the deal folks. When you signed your loan papers, you promised to pay a specific amount. You signed a legally binding contract saying you would make the payments. You also signed that you were aware the lender could take your home if you didn’t pay.
So if you want to sell short, you’re going to have to prove to the lender that you can’t make the payments. Generally speaking saying things like, “But it’s not fair that my home is worth less” and “I want to buy a bigger home” isn’t going to do much to convince the lender you can’t afford the home you are in.
You see, if you can make the payments the bank expects you to honor your commitment to do just that.
You may not like making the payments. You almost certainly don’t enjoy making the payments.
But you can’t honestly expect the lender to just accept tens to hundreds of thousands less than what they loaned you simply because you no longer like writing the check. Let’s face it, the bank doesn’t really give a flip what you like/want/desire. You agreed to pay, they expect you to pay. That’s pretty much it.
Photo credit: walla2chick, Creative Commons license
Email This Post 
Print This Post
Previous post: [ On Dual Agency ]
Next post: [ Chicago’s Horizon Realty Group Sues Former Tenant Over a Twitter Post ]
Thanks for reading! We value your thoughts and opinions, so please feel free to leave a comment. Please contact us if you have any questions or need help. You can also get automatic updates for this blog free via:
{ 7 trackbacks }
{ 54 comments… read them below or add one }
Unfortunately, there are some agents who will try to work with these people, and are then surprised after months of work that there is no way the bank will accept the short sale! Of course, they have also wasted the time of the buyer's agents who brought the buyers thru the property and tried to make an offer.
Jay, I'm struggling on this one. Here's why. If it's clear to the bank that the owner is intending to walk away from their house (for whatever reason), whether or not they've missed payments hasn't made the difference in the short sales that I have been able to push through.
Let's say for argument sake that the seller hasn't missed any payments and they list their home for sale. From the bank's perspective, the seller's motive is unclear. It could be that their circumstances require that they sell. Maybe a job relocation, maybe a divorce, etc. It could simply be that they want out of the deal. Proving just motivation is difficult, and there's grey area.
Now, let's say that that same person just started to withhold their mortgage payments. Does this prove that they have a legitimate hardship or that they've just decided to build a history of missed payments? How would the bank know what their motivation is?
Would the lender care what their motivation is if the seller could prove to them that no matter what, they intend to walk away from the home?
Would the lender be better off approving a short sale, or taking it to foreclosure, regardless of the seller's financial position or motivation?
I agree that walking away from a home and allowing it to foreclose is a bad choice, and carries consequences that are unfavorable. I also think that posing as a potential foreclosure candidate in order to garnish a short sale approval is of ill will. But, I think the decision to allow a short sale weighs heavily on how likely the home is to end up in foreclosure, regardless of the motivation of the seller, because it is difficult to prove.
I don't think it's entirely true to say that one must be behind in payments to succeed at selling short as there are plenty of sellers who are “situationally distressed” but not “financially distressed.” In other words, some people just have to move, and the only way to sell is to sell short. Part of the damage that occurs to the credit history is due to missed payments. A short sale with no missed payments, in my experience, has led to the least negative consequences on a person's credit history.
Jon –
In my experience, lenders in a short sale situation demand a “hardship letter” from the property owner. If the only hardship is that the owner doesn't like making their mortgage payments, then they aren't going to approve a short sale.
Granted, my experience is limited to only a dozen or so short sales.
Agreed completely that the lender may be better off approving a short sale than taking the home back at the Trustee Sale. But if the seller's intent is to buy another home, in the Phoenix area, with a mortgage at or more then their current one, then clearly they can afford their current home.
I also have to wonder what a lender who is about to loan someone $150 – $385K would think if these people just walked away from their present obligation. They approved these loans based on the persons current credit history. The fact they are mailing in the keys when they are perfectly capable of making the payment wouldn't sit well.
You make an excellent point on “situational distress”. But I don't think not liking the fact your home is worth less than you paid for it qualifies.
What the banks should do, and what they actually do, are often (usually?) two different things.
Jay – what I love so much about your writing is that I can really hear your voice coming through every word. Sadly, too true. Well said.
You don't sound too sympathetic here Jay. I think everyone understands what they signed up for, but the issue is they can't refinance, sell, short-sell, move, rent, etc. Homeowners are imprisoned by a home that was over-inflated when they purchased it. Who did the inflating? The banks did… by letting everyone who can fog a mirror buy a home. They got everyone into a home with simple financing and then changed the rules… which caused the demand to decrease along with the price. In turn people are now literally prisoners in their own homes. Try to have a little sympathy. I know it has to be hard dealing with it day in and day out…but these are just smart people looking for options.
Hey Jay, Great post.
I've been working with clients to do loan modifications as an alternative to the short sale process, and I've been getting the same kind of calls. I had a guy yesterday bringing home $6,000 after taxes and monthly expenses (including mortgage payments) of $2500. He thought it was ridiculous that the bank wouldn't modify his loan. At least personal responsibility is still alive and well…
Maybe they should call the company they financed their car through and tell them they need to take it back too because it's worth less than what they bought it for.
Hey Jay here in MI seems like these calls are happening more and more too. Little do they know a short sale is not that easy and many times ends up in foreclosure. Seems the word Commitment has left the country.
Hey Jay, ain't it amazing what folks think they can get a way with! But, three calls in a row, even more amazing. I really enjoyed reading your article, move quite nicely. Well said.
We are 150k in negative equity, did a mortgage audit with an attorney, and found that Wells Fargo doesn't own the note, didn't file paperwork correctly with the county, and calculated our interest rate wrong, along with evidence of tampering with the appraisal, not disclosing properly on the HUD 1 and on and on. All of these things are fraud. We are beginning litigation. I recommend that people do an audit – might provide the leverage they need to get the bank to work with a short sale, or a deed in lieu. We are prepared to take a hit to our credit, but we are not prepared to pay “rent” on a home we'll never own, and we calculate conservatively that it will take 15 years to rebound to purchase price. 150k negative equity = two college educations for our children. My moral obligation is to my family, not to a bank who knowingly committed fraud.
Jeepers Amy, did Wells Fargo do anything right? Good grief. Sorry you have to go through all that…
Amy brings up a good point. I've heard of companies doing these mortgage audits. It's pitched that almost all mortgage have errors by the bank that, supposedly, the errors give you leverage with the bank. I've only heard the pitch. Haven't heard of any successes. My first impression was that is was likely a scam, but I'm open to new evidence. Ya'll heard anything.
Real Scottsdale said, “In other words, some people just have to move, and the only way to sell is to sell short.”
Actually, they can sell at today's market price and bring funds to the closing to make up the shortfall. That's the basic problem with many short sales, people who have funds and no real hardship but don't want to live up to their commitment to pay their loan. I realize that we've never seen so many underwater home *owers* in this country but that's the way it is right now.
Jay -A forensic audit of the loan documents for RESPA and TILA violations may be a “way out” for some people. While many lenders were pushing loans through, there may have been some oversight in the process and people are looking for the loopholes.
I have had it touted as the next new way to make money in this business, but I leave it to attorneys – although I will tell my clients about the option. I do believe there were many people who signed for a loan with terms explained differently than what they actually were.
I know – I know – they signed the docs, but seriously – did they know what they were signing? I think many did not. Yes, they should have known and many signed anything thinking the market will continue climbing and there was no way they would lose equity. Some banks had the same “limited” thinking and gave loans to anyone.
This is very good site for us. i like this site.
Thanks, Jay. I appreciate the kind words. According to my attorney – and there aren't many that specialize in mortgage audits – 80% of the loan docs she sees contain TILA and RESPA violations, which have, I believe, a three year window in which you can challenge the note. The way the mortgages were bought/sold/securitized makes it difficult for the banks to produce the burden of proof that they are indeed owners of the note. From everyone I've talked to and the evidence I've seen, banks are not truly helping people with mods – just tacking on a balance at the end, or lowering the interest rate, or writing a 30 into a 40 year note – none of these things really help people, and the default rate on these mods is extremely high. Bottom line is that we may end up in foreclosure – as far as I see it, this is just a business deal gone bad. I have the right to walk away, just as the bank has the right to foreclose. Once I saw the evidence that the contract was in violation of federal laws, I had no problem with the decision to put them on the defensive. After all, if the bank can't write their own contracts correctly…well, enough said. I'm not a mathemetician and I didn't bring a mortgage interest calculator to the closing, so how on earth would I be aware that my interest rate was off by more than$50k over the life of the loan? Of course we didn't know that we were signing off on an error like this. But there sure are a lot of people who are willing to pass judgement. There is no easy way out – it's going to be a painful process no matter which way you slice it – litigate, walk away, short sale, mortgage mod, or financial slavery for 15 years making payments on an underwater house – all of the choices stink.
Buying a house isn't like buying a pair of pants at Macys. You can't come back later and demand the lower price if the item you bought goes on sale. I'm sorry, but people who bought at the height of the market were either foolish or greedy. Just because the bank *lets* you finance a huge house doesn't mean you *have* to do it. People can blame everyone they want (except for themselves), but they got themselves into this mess. My statement to people who *can* afford to make your payments: If you signed a document saying that you would make payments, then be honorable and make the payments. If the price of houses had never gone down, it wouldn't bother you to make the payments. You just feel foolish that prices have gone down and now other people are getting a much better deal than you got. People who regret buying their overpriced houses and condos are a big part of the financial crisis that is sweeping this country (and the world).
Clue to Arnold – Yes, you can return a pair of pants at Macy's if they go on sale. Same policy at WalMart or Best Buy. You are reducing a very complex, individual issue down to the “foolish” or “greedy”. Your point of view illustrates exactly how uneducated you are about what is really going on. This isn't about a house. This isn't about deciding I don't like the house. This is about the next 20 years of our lives, upon which our financial survival is critical. This is not a short term situation that can be resolved by continuing to make payments. We bought a house at the wrong time. Big deal. I'm not looking for a bailout or a handout. I run my finances like a business. This deal was bad for all parties involved. I'm invoking my rights as they appear in the contract, and so is the bank. All of these armchair philosophers with your theories about what is wrong with the world…spare me. Take a good hard look at yourself.
Good reply! I respect your clear thinking.
Everyone is hearing the words “Short sale” on the media, so naturally they assume that this is the new cool kids way of fixing your mortgage problems. I want to know who decided to call it a “short sale” that was a bad idea and is giving people the wrong impressions about what it means.
-Tyler
We get the same calls here. We also get homeowners that have property management agreements with us that do not tell us when they stop making payments on the investment properties. We then get a call from the tenants when the trustees notice is served to them. Do we need to bring back debtor prison?
Do you mind sharing who your attorney is that did the audit?
Right on Amybrien… All of the people sitting on their high horses are not $150,000 underwater because they bought at the wrong time. Every homeowner has the right to walk away from their home and turn it over to the bank — in Arizona the bank is not even allowed to seek a deficiency judgment is such situations (although they are trying to limit that law). Of course there are consequences to walking away or stopping payments, but in many cases the consequences are better than the alternatives. Would the banks rather people just walk away or try to short sell it first?
I would have to disagree with your statement, foolish and greedy. We were offered ARMS and were told we could buy up to 400,000. The whole time we were thinking, ok that's great but how in the world will we be able to make the payments??
We ended up getting a lender who got us into a 30 yr. fixed at 4.5 percent, and bought the one house that was the lowest in our area, 325,000, that was a distressed property. Some may say that was foolish but we were young, had 2 kids and wanted to own our own home. We had people from all directions telling us we had better buy now or never be able to buy. The house is 960 sq. feet with one bathroom, so we didnt buy some huge house!
The house is now around 159,000, we are stuck here with no options. Also in credit card debt from making the house livable. We thought at some point we would have a little equity to pay it off.
The bank will not lower our payments and we are only making minimus payments on our credit cards, we are currently pursuing a short sale and just received and offer on our home.
We do not want to do this but really feel there are no other options.
These sorts of problems are effecting many people across the Western World. Ultimately if people stick it out, their long-term investment will come good but with these World events, it’s going to take time. One of the key differences between renting and buying is that with renting you can move on with relatively little consequence. However, with buying, you are responsible for that property and your own debts. But stick it out long enough and it generally comes good. Then it’s your home, there’s no rent to pay and you can decorate how you like.
“{stunned silence} Well, that’s not fair!”
This is my favorite part of the conversation by far.
You are a moron. And probably don't even own a home or were renting at the time. You think you had a crystal ball you probably just couldn't afford a home. People bought homes and had there values double before you could close escrow. Banks bait and switched on new construction homes and mortgage writers undervalued taxes and insurance to make the payments appear as the client needed on docs they also did things to help the applications pass through even if the client could not qualify. People who built homes were stuck with huge tax and insurance increases because of the value of there homes doubling before escrow could close which tacked on unrealistic increases to escrow I know mine was a change of 3,200 to 3,850 in 6 months. This was not fair for people who were not subprime which mine was not and I put 35k down on my home. Now I had to sell my house because of this huge increase based on my value going up. NEWSFLASH SMARTY YOU CAN'T LOCK A CONSTRUCTION LOAN UNTIL YOUR HOME IS FINISHED BEING BUILT. Now that these values are coming down my escrow has not changed without a fight. This fight is a full time job that I did not sign up for buying my home. Blame the situation on the investors overpriced realtors, flippers, but it's not a average home buyers fault. I have to lose my life savings because of the fore metioned and people like you that have sat back with a grin on your face while the economy nose dives. Causing more job losses and a never ending spiral of financial doom. And if you can honestly say that you like this economy you are a dope. The fact is that you better hope that they forgive these loans and allow things to go back because you won't have a job to pay for a uhaul box on the side of a highway if it doesn't that's the facts. This whole mess everything gas, tax increases, auto, food is all tied in to housing dummy. And it was the people that were buying homes that kept you in your job it you dopes sitting back now going I'll wait and see that is causing it to continue. P.S. I finally got a short sale approval and my mod both at the same time I can take either, after 5 years of struggle I will be paying less on my 3,000 sf home on 1.15 acres than you will be paying on your stupid rental. And I get a tax cut modified my car loan and can rent this thing out for a profit. WOO HOO If this mess didn't happen I would be stuck with either another inflated house or paying for all you morons to rent homes while my taxes pay for your services. Have fun renting.
Happy modified homeowner old payment 3,850 new payment 1,240 for 5 years see if you can rent for that. Start having some compassion for your fellow man because if you were or are renting you contribute nothing to the economy in the first place your local economy runs on property taxes and everything you use is paid for by homeowners stuck in these homes that banks lies and overvalued to trap us here. BUT I LOVE MY PAYMENT NOW SUCKERS.
Can't wait as the mods get faster and the banks more willing to work with homeowners you renters are going to be stuck renting as we will be renting our homes out instead of selling them then here's the real deal you will be working for us paying our mortgages and all the while you thought you were going to get an even better deal who's the greedy assholes now. YOU
We made an offer on a short-sale about a month ago. I called my agent to ask if she had heard and she said, “Actually, the sellers wrote a letter to the bank telling them that they are willing to take a loan out to pay the difference of the amount that they are short–that's a good thing”. :O I don't think that is a good thing. If you can make payments on a loan, then why are you trying to short-sell in the first place? The bank has 2 more weeks to approve the sale according to our contract. I'm currently looking at back-ups….LOL.
Don't you love when people make plans, when they aren't informed on the process. They need to learn about what a short sale is before they start saying that its for them.
We are having a hard time paying our morgage. We have cut what we can from our expenses. we owe more than what it is worth. To add more pain to our situaton our loan has switched over to an interest only loan. To refiance we have to come up with 6,000 dollars( we do not have) and we would still be in the same situation being morgage poor bearly getting by. How to we prove hardship?
Why do you not want to sell your house short? Are there credit risks? Can you buy another house, after selling short? What have you learned throughout this process?
hi
Its nice to read this blos post as i am also a home awner and need to know all these policies…
so thanks for sharing such a nice information.
Exactly! Prisoners! The fact is people purchase homes for INVESTMENTS. And when the bottom drops out and values decrease then your left basically paying rent on a home that will never have any equity…and when you need a home repair loan..say, for a new roof..then your SCREWED because no one will lend to someone with NO EQUITY! So much for buying a home. I should have rented then the landlord could fix the roof.
We had people from all directions telling us we had better buy now or never be able to buy
So you are blaming other people for your mistake. Just like people blaming banks for adjusting there adjustable rate mortgages. How many times I went to an open house and the realtor told me there are plenty of programs out there and the I could afford the 375k house. I said no thanks I cannot afford a house that is that expensive. It is unfortunate that this whole issue happened but if you signed a contract you are obligated to it. People say well the bank this the bank that. Honestly yes some banks did bad things but people were not thinking and just let the banks talk them into these shady mortgages. News flash… the market has been declining since the end of 2005. All these Realtors and Economists say prices never fall and all the other BS lines to try and get people to buy.
And yet how quickly people forgot the housing bubble of the late 80's early 90's where at the end prices dropped up to 50% from there peak.
As far as people whining about not being able to get out of a short sale because there house is worth less..tough. People say Housing is and investment. So if you invest 100k in the stock market and lose 30k , do you think that they will forgive the 30k loss? They would laugh at you.
My view on a home is a place to settle down and live, even raise a family if you choose. If you decide to sell in the future and make a few bucks hey thats great, but I am not planning my future around it.
To this day I still see places listed at peak of the market prices. Maybe I should call my bank and tell them I want to sell my truck for less than I owe and have them eat the difference. It's worth less than I owe. I even have a hardship story. The truck was sold to me from a dealership who had an accident, fixed it and than sold it to me even having my 7 week old twin boys there and failed to mention that. I do not want to keep the truck because things seem to be getting worse. I have tried filing a complaint with a lawyer but do to legal loopholes there is nothing I can do. So why to the people who made stupid mistake and now have hardships get to give less than they owe? In my case I would only lose a couple thousand but it's still money I cannot afford to lose.
I'm right there with you on that. Of course, what's morally right isn't always what the sellers are interested in, and unless they really have a hardship, they should probably not be trying to squeak out of their situation.
I'm right there with you on that. Of course, what's morally right isn't always what the sellers are interested in, and unless they really have a hardship, they should probably not be trying to squeak out of their situation.
i agree you are responsible for your house, but 2 years ago when people called you everyday and sent you mail stating that you could refinance and your house will be worth so much more in 2 years it is hard to take that. and the people that came in and appraised your house say to you” how much do you need it to be” just so you can get your huge cash out was just wrong also. Now the mortgage companies got all this money from the government because they invested everyones interest money bad. so why should someone not feel like they should get help just like the lenders did. lets put this another way you have a $2000 mortgage and $1700 goes to interest payment and $300 goes to principal, how in the world did these companies go bankrupt when they got so much more money than the principal, and why are they not lending the money that the government gave them. If i ever have to leave my house, since i am upside down, i will not think twice about short sale, deed in lieu, or just walking since the lenders cried so much and got all this money from the government, they lose all the money we give them and then has the government bail them out and you say we should do the right thing, why because they didnt do the right thing in the first place. the mortgage companies should be held responsible for the mishandling of the funds they recieved from all those mortgages, the interest alone on a 1 mortgage will take care of 10 mortgage principals for a lender, and they went bankrupt. sounds like they need some new accountants if you ask me.
at least you can move with your car you cant move your house and that is what is going to start a huge mess in Arizona where so many people are upside down and will need to move for jobs, kids schools, etc coming up. the lenders blindsided people and now the rules have changed. do i really feel sorry for a lender who is still giving out bonus checks even though they are bankrupt and using government money, hell no.
yes it is, look what the mortgage companies and banks got away with. you are ignorant if you really think the mortgage companies and banks were on the up and up and if they are so responsible why did they recieve so much money from the government? you think if i go bankrupt the government will give me some money? also what are these banks and mortgage companies doing with this money they got? NOTHING! they are still paying bonuses and what not. talk about thieves of government money.
lets put it this way if i am $120k upside down and the market will not even start to go up by 2015, that is 6 years then another 10 years at least to recoup my $120k in my house. Try this one on if i just walked away and rented for 7 years then bought a house i will be out of my mess cleaned up my credit and have equity in a new house in 8 years not waiting 16 years as with your plan, lets see what should i do, i walk and take the consequences for a few years but am far better off in 8 years than if i stayed in my house. what is the phrase, ” looking out for number 1″ that is what i am doing.
Yes that piece of paper we sign has consiquences we all have to live up to. For those home owners searching the web for a way to sell my house or stop foreclosure please realize that there has been a 40% drop in home prices over the last 3 years. The pundents say that prices will fall until the mid 2010 time period. What is a home owner to do? Well the private investor in your community probably has the most solutions to offer you at this time.
Yes that piece of paper we sign has consiquences we all have to live up to. For those home owners searching the web for a way to sell my house or stop foreclosure please realize that there has been a 40% drop in home prices over the last 3 years. The pundents say that prices will fall until the mid 2010 time period. What is a home owner to do? Well the private investor in your community probably has the most solutions to offer you at this time.
This kind of leads in to a question I have.
Ditto in being in the same boat as many others. We are 100,000-115,000 negative equity. We definitely qualify for a hardship remodification and have already applied. In the meantime….found out we must relocate. We do not have the cash to make up for a sale at market value, but wonder if the bank would let us sell at market value, then roll in the difference in a new loan for a new home in the city we have to move to. The plus is we can purchase a home for hundreds of thousands less in the new city and based on this would rather meet our obligations. If the bank wont work with us, I see no way other than to short sell period, and if they wont let us, simply walk away. Has anyone heard of a bank working with its borrowers in this way??
This kind of leads in to a question I have.
Ditto in being in the same boat as many others. We are 100,000-115,000 negative equity. We definitely qualify for a hardship remodification and have already applied. In the meantime….found out we must relocate. We do not have the cash to make up for a sale at market value, but wonder if the bank would let us sell at market value, then roll in the difference in a new loan for a new home in the city we have to move to. The plus is we can purchase a home for hundreds of thousands less in the new city and based on this would rather meet our obligations. If the bank wont work with us, I see no way other than to short sell period, and if they wont let us, simply walk away. Has anyone heard of a bank working with its borrowers in this way??
Happy, first of all, please understand that I'm a real estate agent, not an attorney or an accountant. But basically, it would be nice if it worked that way but mortgages simply don't. The loan is on a house, it isn't transferable to another even with your good intentions of rolling your deficit over to the new home. I noticed you have also applied for a loan mod, please don't give anyone any money who promises to help you, they are basically scams.
Howard,
THanks for getting back to me. Since I posted, my husband called the mortgage company and found out exactly what you stated. We thought since we were with a major bank, Chase, that this might be possible. However, we found that our loan is investor backed, and Chase really doenst have any discretion. Its highly unfortunate that things work this way because in the end, everyone loses. We also learned that the short sale process makes it really hard for well meaning, honest people to actually do the right thing. The process takes forever….and you will be lucky to find a buyer willing to wait 90-120 days to close on a house. There is no incentive to try to get the most out of the sale price because the seller is forgiven the short fall regardless if it is 10,000 or 100,000 and it hurts your credit at the same rate. It seems to me the banks and investors are hurting themselves by not being flexible and thinking outside the box. Its a real shame. We feel awful that we are not able to keep our commitment, but being relocated isnt a choice as much as a necessity in this economy. Its not possible for us to stay here….if it were, we certainly would not be leaving. I wonder how the industry might shift to accommodate these types of situations in the future. And with as many people either defaulting or short selling their homes, I wonder if the banks/government will have to reconsider some of their tighter regulations….or else, there will not be very many people to make loans to. Basically our income level is 6 figures, our credit is outstanding and without our current mortgage our debt to income is pretty low. We would be perfect candidates for a home mortgage, but because we are basically forced into a position to short sell, our credit will be damaged and we will be looked at as unrealiable for a new mortgage. It seems to me not lending, at market rates, to these types of profiles could add up to even more trouble for the mortgage industry.
Great Article…shows how far we have yet to come out of this. I work for a company called ——— that assists homeowners and realtors NATIONWIDE in avoiding foreclosure and getting their home sold via a short sale. We NEVER charge the seller or a realtor an upfront fee for our services, we only get paid when the transaction closes. Have you been denied a loan modification, are in danger of missing mortgage payments or owe more than your home is worth? DON’T WAIT BE PROACTIVE!
[links & company name redacted - violation of comment policy: no advertising. I don't advertise for free on your site, please don't on mine.]
We bought five years ago, and I ended up having brain surgery. I thought that was a done deal, we have moved from the northwest, and thought it was all done.
Now, my doctors say I need another surgery. The banks have refused to work with us to refinance the mortgage. The interest rate is and has been 7.25 percent. We went in with around 50K down payment.
We had no intention of walking away, but indeed we will walk away. I have to have family and support for medical reasons, we are struggling with medical/credit card bills and everyone seems to be getting a break on their interest rate but us.
Forgot to add, the reason the interest rate is so high, is because hubby is self-employed, even though we had a great payment history with Wells Fargo.
We have tried and tried, they even tried to fast talk us at the Mortgage Center, saying “oh you really in all actuality have a lower interest rate, when you consider the points and all”
blah blah
“blah blah” pretty much sums it up KPM. And it stinks. It never ceases to amaze me how short-sighted these lenders can be. Sure, they have a business to run, I understand that. But there are too many people like yourself, in some sort of situation beyond their control BUT WILLING TO WORK IT OUT, and they won’t listen. It’s mind-boggling.
I hope things turn out OK for you. Thanks for stopping by.
KPM,
Our thoughts and prayers go out to you and we hope that your surgery goes well. If you and your hubby are unable to get a modification, perhaps you would like to short sell your home rather than just walk away. We never charge you an upfront fee (we get paid by the banks) and we will locate an agent for you, gather the documentation from your agent and yourselves and we deal with the headache and heartache of dealing with the bank. If this is something you would like to consider, please contact us as soon as possible so we can attempt to get your house sold via a short sale and avoid foreclosure.
WEBSITE REDACTED
EMAIL REDACTED
Jay’s note: While I appreciate the desire to help KPM, I really do, it’s just not appropriate to advertise your services on my web site. I realize this may sound harsh, but think about it. I’ve spent literally tens of hundreds of hours developing and writing for this blog and it is the primary factor in getting clients for my business. This is the second time in a week that you’ve advertised on my site — which is a direct violation of our comment policy. (scroll up to see your previous comment on this thread).
If KPM want’s your contact info, I’ll gladly provide it to her. But I’d appreciate it if you’d refrain from advertising here. If you really want to advertise here, contact me and maybe we can work out an arrangement.
Sorry to butt in on the comment thread here, but this note is to the short sale helper person that insists on violating our comment policy by advertising their services in the comments.
Please stop. If you want to advertise here, contact me and perhaps we can make arrangements. I don’t want to sound like a jerk, but I put significant time and resources into this site. It’s not a free advertising service, particularly for a company in the same field as I’m in.
My husband and I bought our home five years ago. We were approved for $500,000, but knew that was crazy- if something happend to one of us we would never be able to make the payment. So we purchased our home for $227,000. Three years ago, we divorced. I tried the sell the home per the divorce and it did not sell, so I had to refinance to get his name off the title and buy him out. At that time it appraised for $251,500. I tried two years ago to sell, nothing. This year I attempted to sell, and due to all of the people who were crazy and overbought loosing their homes to foreclosure- my home fell in value $50,000 in two years! Now if I want to hire an agent, I would be paying to sell the house! I have to get back to my family- I am 50 miles away from my two older boys, and have just been waiting for the market to right itself to go back home. I am being told that it is going to take five years for the market to recover and get enough to sell my house. Now this is wrong- I did not over spend, and I am being punished. Guess what…. I am short selling my house! I need family to be there to take care of my youngest son while I work, and my older sons need me there for them. I am so mad right now I could just … well lets say spit! I am loosing my excellent credit rating – due to the banks lending to stupid people!
So I bought our Arizona home in 2005, due to a job change we moved to Las Vegas in 2007. We rented our home in Arizona but have run into huge problems with recent renters. Since our move to Las Vegas we had moved to Idaho, due to a job transfer. We now own a home in Arizona and Idaho, however our renters have missed payments, caused damage and not paid on time, ever. We are on our third set of renters. While we never intended to short or let our home go we now find ourselves in that position.
My point in writing this is that I strongly disagree with the creator of this post. Arizona is a prime example of unscrupulous lending practices. Who signed those bank offers, who appraised the homes, who approved unqualified buyers for loans the bank knew they would shortly not be able to afford? I appreciate your attempt to be honest and noble but you should also look directly back at yourself when you start pointing and placing blame. Who received the bailout? Was it the consumer? Absolutely not, it was the bank and the realty industry who very well knew what they were doing and if they had a brain they knew what the after affect would be as well.
It is great to come on here and act disgusted with others actions but the bottom line is that the bank OWES the buyer of these homes, who as a result of an unregulated market, are now extremely upside down on their mortgages.
To be 100K-200K upside down because of the banks, appraisers and realtors is NOT the buyers fault.
While the blame does not lie completely with the banks, appraisers and realtors, they do share a LARGE portion of the blame. In Arizona you had this huge population that should have never qualified for a mortgage, yet the lending, appraising and realty regimes plowed forward, making decisions that they KNEW would lead to this mortgage meltdown. Only difference is that it is the Bank who got the bailout.
I think the consumer deserves theirs.
Honestly:)