Gettting the deed in short sale?

Question

How many of you get the deed when you do a short sale? and what are the advantages of doing it this way?

Mitch Freed · Answer

For the deed transfer...has anybody had an issue at the closing table?  If you write an offer to the seller..get it approved by the lender..the approval letter states that the seller is "homeowner" but that technically isn't the case if you have transferred the deed prior to closing.

How will you get the foreclosing lender to approve the HUD if it lists the "homeowner" as the seller...but you are already the owner of record.

Anyways...i use the recorded option method and it seems to work perfect.  Quite a few investors have gotten themselves into some trouble by getting homeowners to deed their house over...they didn't have any ill will in mind..but some homeowners have been known to act irrational during times of financial strain...and they mention to somebody that they deeded their house away to some investor...could spell trouble.

The option is much less threatening than the deed transfer...the seller doesn't lose ownership...and the option has just as much power if utilized.

Jonathan Rexford · Answer

I get the deed when I close on the property. I am not a huge fan of these option short sale flips or deed into land trust. I think some day these transactions are going to be short lived and some people are going to be in trouble. Just my opinion.

Marcus Mccray · Answer

Attention: I don't know if this will apply to those without an RE License but I read that per CA Law it is against the law to have sellers sign over the deed to you the investor before the seller's right to cancel period has ended!!!! 
***Is on the new NOD Purchase Agreement, CAR form.

James Ward · Answer

I/We do not get the deed until the day we close.  I/We also do not use any type of option or record an option.

I/We use the FAR/BAR (Florida purchase and sale contract).

Marcus Mccray · Answer

Mitch,
Can you send me more info on the option approach?

Lafi S. · Answer

I used the deed for a while...then I switched to the option and it has been a lot easier...

Chad Black · Answer

File the option, it gives the equi. title, all you need.

Justin S. · Answer

Some investors live and die by the deed and some don't.  In a short sales the deed gives you:

1.  Equitable interest in the property to market it under your name.
2.  Protects you from someone else buying the property.

About half the investors I know record the deed and the other half do not.

Others get around this via option contracts and filing an option notice.  It really depends on how you want to work the deal.

Gettting the deed in short sale?

Most Popular Reply