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I've been working on a short sale for my Los Angeles Property since February. (I tried for a refinance for a year before that.) I have two loans. Both serviced by Chase and owned by Fannie Mae. The total debt is 465,000. The first is an ARM. The 2nd is a HELOC although I never spent any money. I decided to pursue a short sale based on the advice of a HUD housing counselor.
I stopped making my payments on the first and obtained the services of a realtor experienced with short sales. She immediately found a very strong and interested buyer who made an offer of 240,000. The bank sent an agent to do a BPO. The bank countered with a selling price of 280,000. Our buyer wasn't willing to go higher and we believed the banks number was high as well. We paid for an appraisal of the property which came in at 225,000. We submitted that to that bank but they said the sale price of 280,000 was not negotiable. We tried to market the property for that amount but didn't get any offers. Chase closed our file and by that time we had gone into foreclosure.
I wrote letters to my elected officials, researched the new HAFA program, called Fannie Mae directly and tried everything to find a way to get Chase to reopen the file so we could avoid foreclosure. We resubmitted our paperwork for the short sale and Chase reopened our file. Chase ordered a new BPO and sent an agent from a different county. We handed him the appraisal of the property that put the value at 225,000 and yet Chase still came back with a sale price of 280,000. And then a few week later, they reconsidered and APPROVED THE SHORT SALE for 240,000. And luckily, our very patient buyer hung in there. We were ready to go.
But now the negotiator for the 2nd is telling me that the only way I can get my name off the note and settle the debt is by paying 12,000 to them at closing. Otherwise, I might be subject to a deficiency judgement in the future. If I let the property go into foreclosure, I'm still potentially subject to a deficiency judgement on the 2nd because its a refi / HELOC. After all the work I've done, I don't want to file bankruptcy. I have no other debts and I don't want to loose what money I do have.
So my questions are these:
-Has anyone heard of the 2nd demanding a pay off from the borrower to settle the debt?
-If so, is this number ever negotiable?
-Right now, the first is only giving the 2nd 2,000 dollars which I understand is standard but is it possible to get the negotiator for the 1st loan to re-work her numbers?
-Do I have any other recourse?
Thank you so much!
Last edited by justinday; 07-23-2010 at 12:07 PM..
If they are both Chase accounts why the second negotiator? The standard to the second lien holder is usually $3000. but if they are the holder then who are they offering it too? Chase doeas say in its shortsales that they may come after you for the money owed in their shortsale contract.
Because when we refinanced several years ago, our lender made the second mortgage an equity line and not another mortgage. I have no idea why. That was before I learned how stupid I had been about mortgages and how I ultimately got into this mess.
I don't know why there are two negotiators. Presumably because they are two different loans.
Because when we refinanced several years ago, our lender made the second mortgage an equity line and not another mortgage. I have no idea why. That was before I learned how stupid I had been about mortgages and how I ultimately got into this mess.
I don't know why there are two negotiators. Presumably because they are two different loans.
So you did a refinance? Did you do a "cash out refinance" and that's how you ended up with the HELOC?
Something doesn't sound right? Did you refinance and take out equity in the formof money from the home?
I know the current short sale loan forgiveness law that expires Dec 31 2012 forgives short sales amount but does not forgive home equity loans /cash out refinancing that wasn't used to improve the home.
I'm sorry, I should have been more clear. Its kind of a long story.
We started out with two loans when we bought the property in 2005. They were both ARMS.
In 2006, we refinanced the 2nd and pulled out equity. Every dime (except a few pizzas) went into the property.
In 2008, we refinanced BOTH loans with WAMU because the original first was adjusting.
We ended up with another interest only ARM and another equity line. But that time we didn't take out any cash (because there wasn't any and we wouldn't have anyway), that was just the kind of loan we got. I don't really understand it myself either.
We were so stupid. We didn't understand anything. I know that now. But now we just want to get out of it without having to file bankruptcy and without having to go into foreclosure if we can avoid it.
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