I have a friend who is buying a short sale. The short sale has not been approved by the bank yet (and from what I understand, probably won’t be for awhile). However, her real estate agent is telling them to still close on the mortgage next week.
Why would they close on the mortgage before the sale is even approved by the bank?
They can not close without short sale approval.
What property would the new lenders cash be attached to?
How do you get title insurance on this un-approved property?
How can a Note and Deed of Trust be recorded?
You can not close until an approval letter is issued?
Where does your title company send the money?
They’re refinancing their current home (which is currently paid off) to purchase a rental property. So they’ll essentially be given the money, then use it to buy the rental.
I don’t understand why their agent is rushing them to close on the mortgage before the bank has even accepted the short sale.
Don’t do a thing until a short sale is approved!
Something smells FISHY in denmark!!!
Yeah, I don’t even see what the Realtor is talking about. Until the short sale is approved, the current lender is not going to release the lien on the property. So your friend will be holding a property with other liens attached. Also, if there is a second lien, then the second lien also needs to be negotiated prior to the sale. No title company should be doing any type of closing until the 1st and 2nd lien holders have approved the short sale. Tell your friend that maybe a new Realtor would be better.