Need some advice about short sales (Chicago, Virginia: condo, mortgage, house)

[Mark45]

Hey everyone ,
I need some good advice about short sales and maybe one of you can help.
See I'm trying to sell my condo in Chicago and as of today we were all set and waiting for the bank to give us a closing date ,and then the bank rejected the deal.. what is someone in my position to do now ..?
here is a little back ground on what's going on ..
I put my condo on the market about a year ago and had a ton of people looking at it but no offers. So after 5 or 6 months we asked the bank if we would be able to go to a short sale , and after tons of paperwork they said okay.. so fast foreword to now.
Now mind you i am not behind on any payments to the bank at this time.as a matter of fact i am still making payments to the mortgage because i'm trying to be responsible even though in a few months i will run out of money and will stop making payments on the mortgage .
So i wrote to the bank a hardship letter asking them to allow the sale of the condo before it's too late and i end up over my head and they end up taking the condo ..
now after a few months and a few price drops we get a buyer for the condo and we start working on all the paperwork .. the guy who wants to buy my place has enough money for a good down payment and all, and seems to be just what the bank wants, so he makes an offer to the bank for about 16k less than they are asking for.. now to me this seems like a good offer because the loss is not real big, but i guess the bank does not see it that way..and so they said NO to the offer and now i don't know what to do.. i have the guy calling me about buying the place because he wants it pretty bad and i have not told him yet.. i plan on telling him soon , but not before i used up all my options first.
can anyone offer any helpful advice as to what steps i should take .

thanks for letting me vent
M

[stlma]

If you are behind in payments, the bank has the first right of refusal (because they essentially own it)....but if you are making FULL payments -- this does not make sense. Therefore, you should contact the Chicago Legal Services for help....it is based on income and may be free in your case. Best of luck!

[DoneWithDC]

If you have been making full payments to your mortgage, then that is probably a big part of the reason that your short sale was rejected by the bank. I lost my job in Virginia last fall and had no good prospects at the time, so my wife and I contacted the realtor who helped us buy the house we were in. Our realtor knew the short sale process like the back of her hand and explained that, although she isn't allowed to advise us to stop paying our mortgage, almost the only way the bank would approve the short sale of our house was if we stopped paying the mortgage. Within 3 weeks of the house being on the market, we had an offer and then 4 months later (after making no mortgage payments), our house was sold.

I am not saying that the only way the bank will approve it, is if you stop making payments. Believe me, I felt extremely guilty about not paying the mortgage, but I also knew that given my job situation, we would be completely broke if we kept paying it.

Did you make it to the stage of the short sale process when the bank sends out people to estimate the value of your condo? If the guy is offering $16K less than what your place was listed for, but the bank has its current value as a higher amount, then they probably won't want to let it go for $16K less because they are probably already taking a pretty sizable hit to let the house go for less than what you owe on it.

Good luck! The short sale process is a long and messy one, but it can work out; at least it did in my case.