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*EDIT* Sorry-meant to post this in the Foreclosure/short sale forum-can a mod move it please?
Anybody done this? Here's the backstory:
We filed for CH7 back in 2012, were discharged in 2013-mortgage was discharged as well. The house is not underwater but rather, "floundering on the surface." We anticipate problems paying our mortgage in the early part of next year due to a temporary loss of income combined with some increased expenses, so we're going to fall behind for a few months. Our mortgage company has refused to modify us/offer any kind of forbearance plan, and will basically start the ball rolling on a foreclosure once we're 90 days behind even though we've never even been late in 6 years-not even through the bankruptcy.
In light of all of that, I had a thought-what if we were able to "shop around" for a buyer and help to broker a short sale, and then simply rent from that person (for less than we are paying for our mortgage) afterwards? Anyone ever done anything like this? We would prefer it because we'd get to stay in the home, in the neighborhood, etc... Our daughter would not have to leave her friends and her school, and we'd avoid a foreclosure on our credit (it's bad enough already because of the bankruptcy).
No good landlord will do this. The risks of renting to the previous owners are WAY too high because you, as the renter, can claim he stole the property through creative legal process and attempt to sue for the property. Any landlord worth his salt will immediately evict the former owner upon taking possession of the property.
PS. It sucks because it would otherwise be a solid arrangement, but a few former sellers have established a legal precedent that puts vastly too much risk on the landlord.
I have not done a short sale for almost a year now (thank heaven) but I know that every one I've had required the seller to sign an agreement that they were not involved in any sort of deal like this. You might be better off talking to an attorney who handles this sort of thing to see if they might be able to work something less drastic out for you.
The buyer of a short sale also has to sign an arms length agreement - basically stating they do not have a relationship with the seller and won't rent it to them. In most cases, renting back to you would constitute fraud and create legal liability for the buyer. Not worth it.
I have not done a short sale for almost a year now (thank heaven) but I know that every one I've had required the seller to sign an agreement that they were not involved in any sort of deal like this. You might be better off talking to an attorney who handles this sort of thing to see if they might be able to work something less drastic out for you.
I'm afraid that the only thing less drastic is simply losing the home altogether. I guess I see the legal reasoning, but honestly a deal like this will likely work out better for the bank than a sheriff's sale in the end...
The buyer of a short sale also has to sign an arms length agreement - basically stating they do not have a relationship with the seller and won't rent it to them. In most cases, renting back to you would constitute fraud and create legal liability for the buyer. Not worth it.
This. All parties, including the agents, have to sign an addendum stating that this is an arms length agreement. So you would have to have a buyer agent, seller agent, you and the buyer all agree to commit fraud.
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