SOCIAL: short sale

[Erin Milnes]

Helpful explanation. and that site has lots of good info.

 

Palak, I know someone who has done a short sale recently in Portland, and
someone whose bank refused the deal here in Oakland. Neither involved family
members, but there are plenty of reasons it won't go through even without
the "arms-length" issue. If you'd like to speak with someone who has been
through it, let me know.

 

A short sale is a way to sell a house whose mortgage (bank loan) amount is
greater than the current market value of the house (a situation that is
called being "upside down" or "under water"). It is in the bank's interest
(as well as the homeowner) to avoid foreclosure, so they agree to the owner
selling the house at a price that's less than the mortgage and forgive the
remainder of the debt. When you do a short sale it wrecks your credit for
several years, but not as long as if you declare bankruptcy or walk away
from the house and let it be foreclosed upon. 

 

We have thought about short sale ourselves a little, and it may become a
reality in three years for us if the market here doesn't improve. We'd like
to get out of Oakland before Duncan goes to kindergarten.

 

The practice is becoming much more common, so there should be a lot of
material online in addition to the site that Geoff provided if you want to
more.

 

Good luck to your family,

Erin

 

  _____  

From: social-bounces at lists.deeptrouble.com
[mailto:social-bounces at lists.deeptrouble.com] On Behalf Of Geoff Davis
Sent: Wednesday, June 23, 2010 5:18 PM
To: Amy Muller
Cc: Social Social
Subject: Re: SOCIAL: short sale

 

http://homebuying.about.com/od/shortsale/f/arms-length-affidavit.htm

On Wed, Jun 23, 2010 at 5:08 PM, Amy Muller <amymuller at gmail.com> wrote:

Hmmm... I was just listening to Forum (I think it was Forum) the other day
on NPR and someone called up and said they were under water on their house
and they specifically asked if it was ethical to do a short sale of their
house to a family member and then buy it back. The "expert" on the show said
that it was actually categorically illegal to short sale sell a house to a
family member or friend. He was very definite about it. But maybe there *is*
some way to do it that's not illegal? I dunno. Just reporting what I heard.
:)

 

On Wed, Jun 23, 2010 at 4:51 PM, Amandeep Jawa <deep at deeptrouble.com> wrote:

Hmmm - here are 2 NPR episodes on short sales - but they seem to being
promoted by the Obama administration:

(so probably not illegal :-) )

 

http://www.npr.org/templates/story/story.php?storyId=124850418

http://www.npr.org/templates/story/story.php?storyId=125518608

 

 

 

On Jun 23, 2010, at 4:48 PM, Amy Muller wrote:





Are you talking about real estate? If so, I *just* heard this question asked
on NPR the other day. Short sale of a property to a family member or friend
is illegal. :(

On Wed, Jun 23, 2010 at 3:31 PM, palak joshi <palak.joshi at gmail.com> wrote:

Dear Social, 

Does anyone understand short sale and can explain me into layman terms? 

Are there pros and cons you can list of being a buyer in the short sale to
help a family member out? 

If not does anyone know anyone i can talk to?

Thanks a lot. 

palak. 


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