I have put a contract on a short sale. Existing owners (couple) are separated and hardship is their divorce. Both are working and can not afford mortgage individually on this home. My question is can one of them buy back this house at a short sale (cheaper price)?Can he or she convince the lender that he/she would be able to make payments on it at the new price.(there is a second loan on this home as well). Will appreciate your inputs.
sam
The current owners can not buy the property back as a short sale!
Either owner can try to convince the lender they are capable of paying under a modification, however the modification will not be discounted as much as your short sale may be, and typically seconds do not modify there position.
In a divorce a husband or wife typically does not want there name or Social Security number attached to the property and does not want to continue to be responsible for the loans.
A lender will not agree to remove either party from the loan, and therefore most divorces without kids will opt to let the property go.
If the couple has children, the judge may allow the wife to keep the home and pay on it if she is able to provide for the kids, and in this case the dad agrees to leave his name on the mortgage.
But has to be a modification for current owners!
But if they sign your contract offer which is required for a short sale, you have no worries as they would be in breech of contract to do anything else.
Thanks! Yes the couple has children and both signed the contract. I am using the services of listing agent who is representing both parties.Agent told me that he has submitted contract through attorney which makes me suspicious and confused. I just want to make sure that I am not pawn in this game.
Most R.E Agent are stupid. They don’t know how to do the shortsale but they want to do it and then killed the deal…-> result the bank take the properties.
What sort of stupidity they do?I guess they are just following procedures of short sales. May be when it comes to negotation , they may lack negotiaton skills or do not know have appropriate experience.Sine in my case LE choose to go through Attorney, is it a good news?