I’m working to buy a house from a distressed homeowner, help her avoid foreclosure. This will require me to deal directly with mortgage lender. Is there a release form I can use so homeowner authorizes me to talk to the bank?

@Juan Carlos Cabrera I assume you are going to attempt a short sale.  Besides the fact that they don't work out 90% of the time, banks are really difficult to deal with.  You might want to bring in a realtor or other professional who can help you with all this.  

You can call the lender. Have the loan number handy, keep in mind that if the mortgage was assigned, it might have a different number to reference. Once you have an operator ready, conference call your seller. Get the pay off.

You can get a signed release and send it in. US Bank charges 20 dollars for a pay off that way.

Originally posted by @Mark Enriquez :

You can call the lender. Have the loan number handy, keep in mind that if the mortgage was assigned, it might have a different number to reference. Once you have an operator ready, conference call your seller. Get the pay off.

You can get a signed release and send it in. US Bank charges 20 dollars for a pay off that way.

Good luck with that strategy. no one is giving you a payoff on the phone. Needs to be in writing and the bank has seven days by law to get it done. If it's not the borrower, they'll require 3rd party authorization and all they are gonna do is send a payoff demand with per diem interest on it. If its anything other than a small town local bank, just make your request for demand on line.

If you are wanting to talk on behalf of the borrower, fine, get that authorization. They aren't going to negotiate with you. If you want to "help" the borrower by reinstating, they'll give you reinstatement figures. Probably not with the first attempt though. If you are trying to "negotiate", they aren't going to negotiate with you. If the BORROWER wants to consider a short sale, they'll send the borrower a package to fill out and complete. Borrower will list the property with an agent on the MLS and then entertain/counter/decline/approve the proposed proceeds. There is no getting around that. Anything else is a deed in lieu or a reinstatement. They aren't going to do anything else.

@Juan Carlos Cabrera I'm assuming you're doing this in Texas, which is one of the easier states to do it. Put the house in contract and open escrow. My suggestion is to do it with a realtor experienced in short sales. Remember, the lender isn't legally allowed to talk to you about someone else's loan without a release, which they will probably want to provide for security anyway. Still, they almost never will negotiate with you directly as the current legal environment would leave them open to a predatory issue potentially.

Once you have escrow open then the process becomes easier. It's much more straightforward for the bank, and it will put the payoff in writing. If the payoff truly is a short sale than the seller needs to start that process.

FYI - if they haven't already started the process for a short sale then most banks will require the property to be listed on MLS for a period of time to ensure they are getting the best offer.... again, make sure you have a realtor involved.

If they have already started the process, then you should just need to get it in escrow and in reality, most of it will work itself out through the process. Just stay on top of the filings for the house because your foreclosure process is like a rocket compared to most states.

Plenty of good advice in this thread. 

Low odds, but you decide if the juice if worth the squeeze!

Thank you all for the advice, much appreciated!