[Gonetodocs]

OK so this is my first official Short Sale Negotiation. I have represented the buyer on a couple of other S.S. deals but this is the 1st where I am negotiating with the bank. Call it my first then.

I have a pretty comprehensive grip on the deal and this is the gist of it:
Owner is on title not on the loan (He got a friend to put financing in his name)
Seller is not on title but on the loan.
Both occupy the property.
They just can't make the payment any more. The house is upside down and they want to sell it fast.
I have a buyer with Fannie Mae Approval as of right credit score
I have the following documentation prepared so far:

• Listing Agreement
• Purchase Contract
• BPO Comps done by my Appraiser
• Loan Commitment by Buyer
• Seller Financial Statement
• Hardship Letter
  • Estimated Sellers Proceeds
  • 401K statement
  • CAR Ca. Assoc. of Realtors PAA form short Pay box checked
  • And quite a few other miscellaneous disclosure to cover my butt.

Questions: What happens to the sellers 401K Approx. 22K Value?
Should I send the lender Fremont a (signed not notarized) quitclaim deed releasing the property back into the name of the Seller (From the Owner)
The Seller has no Bank Account or Has not filed taxes for the last two years. Fremont is requesting them both should I send a IRS form 4506-T request signed also to speed things up and prove that the seller has not filed taxes? He has had no income essentially since he has ultra-disabled.
Do I need to prove that he has no bank account? How do I do that?
Fremont is requesting a Cash contribution? Why and will they snake from his 401K?
Also my Hardship letter is pretty sad outlining a sizable amount of issues. Should I send proof of each issue somehow.

The original pPerson I was told to work with was Ted Griggs
But I just got their package yesterday with a Loss Mitigator named Gabriel Amaya 866-484-0291x.5367
I've got the package ready to go that have requested from me. (consisting of the solid bulet points above) and was hoping to get some more insight before I sent it off. Any advice from soemone who has been in the trenches with Fremont lately or more specifically with the characters listed above? Let me know if I am talking to the right person etc. and that kinda thing. Thanks again.
Gonetodocs

[Corey1023]

Yes its possible that they could require a cash contribution from his 401K if he is the one on the loan. The one on title doesn't matter, he is a non issue to them, other than yes they may require that title be vested back in the original persons name. Its not 100% that they will do this but its possible. You could simply quit claim it to both of them if its an issue.

I do not have a familiarity with the people you mentioned. Why do you ask, are you considering outsourcing it to them?

[877YouKeep]

that quit claim deed is what sticks in my mind, although it is not recorded it is notarized and an attorney would say it is valid. Fannie most likely will have issue with seasoning. I would suggest not mentioning the quit claim deed and proceed with the short sale. If you have a fiduciary responsiblity in the transaction it may be an issue.

"Do I need to prove that he has no bank account? How do I do that?" The lender will take your word on it

The cash contribution should not be an issue your offer should protect your client and if not you need to revist your short sale approach. If you need to buffer your offer just do not make them pay at closing

[Gonetodocs]

Originally Posted by Corey1023

I do not have a familiarity with the people you mentioned. Why do you ask, are you considering outsourcing it to them?

Definitely not outsourcing it. I just wanted to start throwing names around in the forum community here to start to get people's feedback in case they are running into issues with certain people. I try to kinda take a "hard on the Issue yet easy on the person" approach to negotiating so I can build relationships and network for future success. I do have a fiduciary Responsibility to the seller who is not on title. and equally so to the seller on title. I disclosed that to the seller in writing and I can hold it in my back pocket if you believe it will cause me a problem. Please let me know of all of the implications to being a fiduciary to the sellers. Other than it could hurt the negotiations with the lender. I assume the lender doesn't have the mindset that they will be negotiating?!?! Makes sense in theory to me at least.

The cash contribution should not be an issue your offer should protect your client and if not you need to revist your short sale approach. If you need to buffer your offer just do not make them pay at closing

My idea for building the down payment into the deal was to add like some type of addendum stating that they will not have to come into escrow with a down payment (which the seller can't) by offering a higher price only after the lender suggests a down is necessary. They can bring in a small good faith deposit of approx. 1,000-2,000 but nothing crazy over say $3,500. Your thoughts are greatly appreciated on this issue.

Hey I know you guys are busy so I wanted to thank you for your awesome feedback on these forums. I just hope I can help as well as I gain more OJT (On the Job Training) with these deals. I got a ton of'em.
Anyone that doesn't right now is sleeping. Gotta go and one more favor could you email some sleep when you get a chance because I am running low. HaHaHa I know dry but trying to lighten the mood a little.

Sincerely,
Gonetodocs;

[JoDee]

can a short sale be done if the sherriff's sale has occured - but still in the redemption period? who at this point would be considered the seller? or is this a non issue because the bank now owns the property? the house has remained for sale, and now there is a buyer for much higher than what the payoff is / sherriff's sale was for... can I still short sale this? I am sure it would have to be a simultaneous closing if so - but - is the seller not actually the seller now that the sherriffs sale has occured? where would he come in? HELP!!!!!!

[877YouKeep]

The owner of the property does not change until the foreclosure is recorded. The property is reconveyed once the expiration of the redemption period happens and the foreclosure is recorded until that point the owner (seller) can sell and banks will negotiate a short sale during the redemption period. A Deed in Lieu can also bring the homeowner some cash in some states. States with longer redemption periods can also bring $ for the DIL.