All Forum Posts by: Ron S.

You don't stop it just because you have a contract and no one is going to talk to you at the bank without it being listed on the MLS, fully executed purchase and sale agreement, disclosures, proof of funds, etc. unless it's a full payoff and even then, the borrower is the one with the most weight getting them to stop it.

The lender is under no obligation to stall a sale once it's within 37 days from the published sale date. Sometimes, depending on who owns the property, involving an attorney fastracks a foreclosure.

It's an oft discussed topic and there are plenty of resources/answers available by searching the forum.

ORIGINAL liens are public record. The outstanding amounts aren't, unless they have published to go to sale and in that case, the only thing published is the foreclosing entity's figures, not any other potential liens or amounts due by other entities. The only way you can get solid accurate figures is by getting demands from all known encumbrances. If you aren't the owner or, if you don't have 3rd party authorization from the owner, you aren't going to get that information.

More than likely...you go nowhere until the property is listed for sale. There could be numerous reasons why it's not on the market and you won't be able to push it forward or gain any inside track to be the first to buy it.

I second Wayne's comments. It's bad enough you have a ticking clock but clogging it up with an attorney just makes it a perfect storm scenario for a failure.

Love it! Excellent post Seth.

You're probably gonna have to provide a little more information on the subject if you expect any responses from the board that have any substance to them. How was it not proper? Why are they "previous" owners if it was improper? Who says it's improper?

To your question...If the sale date is on the 5th, time is not on your side.

Yes. It's typical and required and no, it's not a done deal once it's on the market. There are many steps. I would suggest introducing the potential seller to an experienced short sale agent.

If I could tell you the hit you would take with any degree of certainty, it would be like having the recipe to Coca Cola. They (Fair Isaac) do not publish the logic behind their algorythms so, it's anyone's guess as to how big the hit is. There are many factors in the logic and a short sale or foreclosure is only one of the multiple data elements. I will say it would be significant though. The general makeup of a FICO score is:

* Payment History (35% of the score is developed from this metric)

* Debt Burden (Not just a debt ratio but, six different metics in the debt category!)

* Lenght of credit History

* Type of credit

* Inquiries

* public records

* credit opened recently

I'm not in production any longer so, I couldn't tell you with conviction what the turnaround time is as, there are almost as many factors in underwriting for a new home purchase as there are in a FICO score. Were you current up to the short sale or foreclosure? Did you get offerred and turn down a modification as an alternative to foreclosure? Was your short sale due to military relocation? Was it a strategic default? Did you buy another home before the short sale or foreclosure? The answers to these questions will cause your wait times to be from 0-84 months to be able to purcahse a new home using conventional financing methods.

This is your decision and yours alone. Everyone here has an opinion and of course, you'll take it all in and come to your own conclusion and hopefully make the best decision for you and your family. If credit and access to it, unhindered and uninterrupted are important to you now, you may not want to risk that 815 FICO score but, if there are other equally important factors in your decision making process, you may want to take the short sale route.

I will end my two cents with this. MA was and probably still is a recourse state so, a short sale may still have tax implications for you to consider. The insolvency test many others pointed out are valid points to consider and may assist you. Imminent default is a valid hardship as well and you would have to document that hardship with your hardship letter and income/expense budget you have to provide, along with tax returns and paystubs and bank statements. If the numbers work, a short sale may be an option the lender would consider. I would hold out for a deficiency waiver if Fannie allows it.

Let us know what direction you go and good luck to you...

@ J Scott, while my examples may be egregious, there are less egregious real world examples of people out there thinking nothing is wrong with what they are doing and it ends up that they are doing something wrong. Is that the case here? Who knows, only time will tell but in my experience, if the rule prohibits transfer for greater than X in 90 days, and someone tries to get Y for it in 90 days, and do it in a way that requires smoke and mirros...well, if it looks quacks and smells like a duck, it might be a duck.

I'm confident Wesley Snipes, Martha Stewart, Willie Nelson, Nicolas Cage, Marc Anthony, Borris Becker,  Annie Leibowitz, Darryl Strawberry, Heidi Fleiss, and Lauren Hill thought they weren't doing anything wrong with their taxes. Kenneth Lay swears he is innocent. Charles Ponzi thought he was innocent. Dennis Kozlowski and Mark Schwartz (My favorites) of Tyco International swear they didn't do anything wrong either. Finally,  I have a borrower that was just sentenced to two years in prison for short sale fraud that thought he wasn't doing anything wrong, and his realtor on the transaction is awaiting sentencing this month. Both believed they were mitigating the impact of the rule and what they did wasn't even a law to break until they committed short sale fraud when they lied about it on their  arms length affidavit. If only they told the truth about what they were doing, they'd be around still.

In my opinion, the best way to mitigate the impact of the rule/law regarding this post is to wait for 90 days. No one gets hurt that way and no one ever has to explain their actions to a jury of their peers or a judge...just to be safe.