Hello Fellow Investors!

Some time ago, I posted a post about my first RE deall…and that I am a newbie…VERY newbie!

This house was going into foreclosure on 05/06…I talked to Countrywide adn gave them the papers that was required to do a short sale.

Thankfully the sale was postponed for 30 days.

The deed is in my name (HO’s idea…she said that CW told her that this was the only way for them to consideer a short sale. HO is also an investor that has 4 other rentals and has done this since 2000)

The mortgage is still in HO’s name.

I am trying to short sale this house, but CW says they it will take 30 days to review the information.

While I am still waiting on CW to review…I get a letter from a law firm that says they can help ME get out of foreclsore.

I called and explained the situation to the atty. He told me that since the deed is now in my name I was the owner and CW can put the foreclosure on my credit report.

So, now I am in a quandry (sp?)…I have some questions that I hope to God can be answered by you good folks:

  1. Can they put the foreclosure on MY credit…even thought I am not on the mtg?

  2. Can I deed the home back to her? :help

  3. If I notify CW…would they try to sue me for the mortgage? :help

The HO wants $5,000 from the short sale. I thought HOs are not to benefit. Please correct me if I am wrong! :help

I told the HO that I feel that this is skating along the liones of mortgage fraud and she said investors do this all the time.

I am aslo considering just terminating the contract, deed it back to her and just be done with it.


Sounds like you put yourself in a pickle.

  1. Can they put the foreclosure on MY credit…even thought I am not on the mtg? No. they can’t, because the mortgage loan balance is what is on the credit report and since the loan balance is in the other person’s name still, there is no way that they can put a foreclosure on your credit report.

  2. Can I deed the home back to her? yes, Quit claim.

  3. If I notify CW…would they try to sue me for the mortgage? they can’t sue you since you don’t own the mortgage.

The HO wants $5,000 from the short sale. I thought HOs are not to benefit. Please correct me if I am wrong! I think he’s asking for a kickback.

Thank you so much for your response.

I talked to a title comapny about that and I was told that quitclaim deeds are not acceptable. I would have to do a warranty deed.

I realize now I was a complete buffoon for this, but thank you all the same.

I will remedy this as soon as Monday, seeing that this is the weekend.

Thanks again for your response.

Don’t use the title company or find another one. OR, complete the QCD and and file it with the court yourself.

And, I’ve never heard of any lender requiring the deed to be put in anyones name other than the HO for a short sale. It’ sounds to me like the HO lied to you thinking they could tie someone else into their mess for their own benefit.

GooD LucK! :beer


I agree that you may have made a small mistake by getting the deed (simply because it wasn’t necessary), but I would urge you to take a deep breath. You haven’t made a big mistake and I don’t believe it’s going to cost you any money. I agree with Lendinghand that they can’t put this foreclosure on your credit report and they certainly can’t come after you for the mortgage. Having the deed in your name is really irrelevant. The bank can still foreclose on the mortgage (the current mortgage holder) and they can still get the deed if they do foreclose. No big deal.

If I were in your shoes, I would probably not deed the property back to the seller. That will make it look like you’re flailing around, which will not inspire confidence with countrywide. Unless your attorney has a good reason for you to deed the property back and advises you to do so, then just leave things alone and keep proceeding with the short sale. You can always deed the property back if Countrywide turns down the short sale.

You are correct that the seller can not profit from a short sale. Obviously, this seller is not much of an investor. Their property is in foreclosure and they’re trying to get you to do something illegal. I would just say NO to the $5,000. If the seller doesn’t want you to do the short sale without getting their illegal $5,000, then THEY have a BIG problem BECAUSE YOU OWN THE PROPERTY and they owe the mortgage. You see, maybe getting that deed wasn’t such a mistake after all. I’d say that you are in a very good position to dictate terms on this deal!

Every deal you ever do will have problems. That is what we get paid for as investors. The gurus never mention that, but it is the truth. If you’re going to get into this business, that is just par for the course. Have a nice weekend and don’t worry about this deal. I think you’re doing fine.

Good Luck,


My thanks to you, Mederator! :smile

I really appreciate it. :smile

I spoke to an attorney that sent me the letter sayingt hey can help me avoid foreclosure. The atty. said that because I was considered the owner of record…I could be faced with a foreclsoure on my credit because of that. :shocked

That was why I wanted to just deed it back.


She is about $11K in arrears. :shocked

When I presented her with the problem…she balked. :help

She told me “the reason I deeded the house to you was because YOU told me to” and my mental response was WTF?! :bs

SHE was the one that suggested that because I didn’t think you could do that seeing that there was a mortgage on the property. :bs

SHE was the one that told me that it was done ALL THE TIME. :bs

SHE was the one that also Quitclaimed it to me as well as filling out the Warranty Deed. :bs

NOW she wants the house deeded back to her. :bs

I smell the stentch of fraud…am I right in stating thus? :bs

Thank you again!

If you are the negotiator working the project…why in the world would you listen to the homeowner? If they knew what they were doing they wouldn’t need you. Number one rule about homeowners facing foreclosure is that they will say and/or do anything if they think it will help them out of their situation. I don’t see any fraud, unless the HO tries to blame you for something…like ‘tricking’ her into signing over the deed.

This is why I have always practiced and taught to NEVER put the property in your name. Secure it with some other means, like a Realtor contract. I have seen HO’s try to prolong the foreclosure by claiming fraud on the part of the negotiator because they tricked them into signing over the deed. I doubt this is the case in your situation, but that doesn’t mean the HO can’t make that claim if they think it would be in their best interest.

I agree with everyone else that the foreclosure will not go on your record. The lien holder doesn’t care who 's name is on record for the property, only who is responsible for the loan.

GooD LucK! :beer

You should be ok…your name is on the house but not the mortgage.

I just hope that there aren’t any liens against the property because they follow with a quit claim.

It sounds like the Homeowner thought that they would be sticking you with the foreclosure. That’s why you need to be in control of your deal. You hear on the news about investors that rip off old ladies in foreclosure, but in my experience, it’s usually the desperate foreclosure person doing the scamming. You are supposed to be the one that is helping them with their situation, not them showing you how to buy their house. Consider this a learning lesson and don’t do it again…