Anyone with short payoff experience?

[Sergio M]

ok

[Humboldt1]

The only way to get the banks to really play ball, especially the larger national banks, is to hire an attorney.

I was actually advised by my lender to stop making payments in order to get the modification department to talk to me.

Depending on your situation, a strategic default may make the most sense. You can even opt to stay in the place after not making payments for 1-3 years with better terms (principal modification, lower interest).

Waiting for the market to improve is the worst solution.

I am now working with an attorney to do shortsales on my properties and after all is said and done I make an additional $46K per year. I actually called the banks for 1 year to try to modify the loan and went nowhere (and I work in the banking industry).

Playing hardball with the banks is really the only way to get anywhere. Hire an attorney.

Your credit is overrated. You will get hit for 2-3 years from the date of the NOD (Notice of default - 6 months after you stop making payments), but then after that it goes off your credit bureau. Basically, someone like me with 800 credit who stops making payments today, should be back to 700-800 credit score within 3-4 years, which is fine because I am not looking to buy another property for the next few years until we get closer to bottom price-wise.

In the interim, if the perfect place comes up I can alway pay cash for that place.

[mcbee01]

keep making payments,and start selling the home off in pieces then move out, let it forclose and buy it back clear for about 1/3 of what you owe. the wealthy people are doing this!!!

[kevinm]

Originally Posted by jrqiii

MarMom,

We are in the same situation and I am curious as to what your outcome is when negotiating a short payoff. Please let me know if you are successful.

Me too! I am try to shortsell my home and I am starting down the "home stretch". My attorney has the name of the negotiator for my first trust and we just got assigned a negotiator for the second trust. I bought my home as an 85/15/5 back in 2006. I have a contract on my house and the buyer is putting down 20% cash.

[felipe carrera]

I can get a loan from some family members, I'm in pre-foreclosure, should I offer to do a short Payoff for 1/3 of the value of the house(that is the amou t I can get)

[Modification Specialist]

Originally Posted by marmom

W......."well, you need to speak with so-and-so, let me transfer you..." They did this until we had gone full circle with various departments.
...Time for an attorney?......

Mamom,

I do not know your total situation. I advise you to be very careful asking questions and forming conclusions on a public forum because the rules are different between the states. There is a lot of wrong information here.

If you know your home will sell quickly, a short sale is the best option. It can not be an arms length transaction.

A sale short does not postpone a foreclosure, and knowing houses are not selling. Being that New Mexico is a Judicial state, where a house can be foreclosed upon in as little as 6 months. It is very clear you could lose the home to foreclosure. It would be best to consider other options. Because a foreclosure would 100% ruin your financial future.

I cannot directly tell you not to pay you mortgage. although If you make on-time payments your lender will never agree to a short sale, or even a modification. Because you are not showing there is a hardship. Banks now days will not agree there is a hardship till the borrower is 60 to 90 days late.

One option could be doing a deed in lieu. An attempt is made for a modification and get denied. Then the home be listed for 90 days, and after that technically walking away for and clear.

Also noting New Mexico is a recourse state, which means that the lender can come after you if your house sold through a short sale for less than the amount owed. They can come after you with a deficiency judgment or 1099c. If you brought the home, you may be able to write that off, however if you refinanced your loan is no longer consitered purchase money and your liable to pay the difference between what was owed and what it sold for.

It is evident the bank is going to play games with you, judging what you have shared. My advice is not to give them any information and seek council.

Contact me if you have further questions...

[learnednewyork]

I'm in negotiations with Bank of America for a short payoff. I've been told in doing so I would not be able to obtain another mortgage from other banking institutions. Is this correct?

[minna_reid]

learnednewyork - you are not likely to get a new loan for about 3 years after a short sale.

OP- A short payoff is a short sale.
I have never seen a lender turn a loss on a home sale into an unsecured note, even if in fact it would be beneficial to them, however they will accept a short sale if a "hardship" can be presented. A hardship does not necessarily mean you have to be behind. I have closed plenty of short sales where the owners were current.
It all depends on a lot of things - the main piece of info here being who the investor is on the loan.
Who you send the payments to is just a servicer and unimportant. Without knowing the investor on your loan - no one could tell you whether you have to be behind to qualify for a short sale.