Short Sale Question

Quote:

Agree with moderator that you explanation is not clear as to the status of your second mortgage. However, assuming it is not currently paid off, what often happens is that the 2nd mortgage lender will either not allow the sale of the property to go through because their loan will not be covered, or the 2nd mortgage lender will attempt to obtain a judgment against you for the difference between what their total loan amount was to you, and the lesser amount you paid back. Meaning, in your example above, you owe $140, but can only get $135 for your property, which leaves you $5 short on paying off the second loan. However, also realize that as the seller of a property you will typically pay a 6% commission to the realtors (i.e. 6% of $135,000 = $8,100). So, take that $8,100 and add that to the $5 shortfall, and your total shortfall is closer to $13,100. So, the 2nd mortgage lender may attempt to obtain a judgment against you for that $13,100, which is to say they may attempt to obtain a court ordered repayment from you to them for $13,000. Now, everything is negotiable, so one thing you might do is contact that 2nd lender in advance and discuss strategies with them which could involve them either forgiving the $13,100 (because they are just happy to get the remaining balance back), or, perhaps they would just issue you a separate Promissory Note to them for the $13,100 - which is similar to the Judgment, but does not involve the courts. All that being said, I suggest you consider an alternative option called The Home Ownership Program, which you can get information about by listening to the free recorded message at 866-206-6272

The above post if as an ad, did you affirm your debt on the 2nd? Either way you can request a short sale on the 2nd. They may ask you to sign a promisary note to pay any difference, but if you did not reaffirm the debt they most likely will not. Call you lender, not some 3rd party company mentioned above, that will most likely have a cut in that $13k mentioned above or out of your own pocket.

Sorry...should have said we have not paid our 2nd since last April.

Ditech should be more then willing to work with you on a short sale. Just call them. They would rather be out $6k to $13k then $65k.