Marketing SB931

There’s a new law taking affect in California on January 1, 2011 that could provide additional relief for homeowners seeking to Short Sale their properties.  Although it only affects first mortgages, Senate Bill 931 (http://www.aroundthecapitol.com/Bills/SB_931) may offer additional protection for those homeowners that really want to avoid a foreclosure.

Short Sales Prior to SB 931 allowed the lender to pursue collection on a deficiency if the short pay agreement did not have full satisfaction language. SB 931 prohibits banks from pursuing deficiency judgments against sellers on 1st liens in California, regardless of whether the seller has refinanced or pulled cash out.

In California, once a seller has refinanced their mortgage, whether it is a cash out refinance or simply a refinance to lower the interest rate, the loan becomes a “recourse loan”, meaning the bank can pursue the seller after the short sale for the deficiency, unless they state in writing that the debt is settled on the short sale approval letter. SB 931 prevents banks from pursuing short sale sellers on all first mortgages in CA.

Now is the time to reach out to homeowners and let them know about the new law.  RadarPrint.com the third party print site of ForeclosureRadar.com has just posted a new SB931 postcard specifically designed to announce the new law and encourage homeowners that may be interested in additional information to pick up the phone.  We hope you find this helpful in getting conversations started with homeowners in distress.  You won’t know if you can help them until you get them talking!