Need the brainiacs on this one:
Got a guy who owns a short sale company. He gets the clients, gets the purchase contract written up, gets the banks to accept the offer, and then finds an end buyer, lining up the contract with the end buyer to the contract with the initial seller. He wants to me to basically finance all his end buyers. I work for Citi Mtg, and it appears that underwriting has a big problem when there are two sales contracts on the same property. Breaks the chain of title, they say. So, essentially, I have to wait until the deal with the seller closes, and the title reflects the property passing hands. As you can probably figure out, this creates a problem, because the guy then loses time and has to look for financing to tie him over until the contract with the end buyer closes.
He mentioned that he uses a land trust, to get around the problem (I don’t know much about land trusts, but, according to his explanation, it creates a brick wall between the two transactions, since it only discloses the trust name, not the property owner). However, Citi doesn’t finance Land Trust sales anywhere outside of Illinois.
Do you know of any lenders that:
a) Don’t mind the double closing? Wil start financing with 2 sales contracts on the property, and chain of title screwy?
b) If not, any lenders that can finance the Land Trust?