Upside Down Mortgage

Posts Tagged ‘loss mitigation short sales’

Loss Mitigation Short Sale

Question: Short Sale?

I'm so confused right now, because I'm trying to purchase a short sale. The seller has accepted my contract and now it's with loss mitigation. My lender doesn't think it's valid because we offered 265 and she owes 325. My agent says that the loss is not that big, because of the current housing market, and the listing agent says he is confident it will go to closing. My lender wants me to look at other options, but i really like this house. I do have something else as a back up, but what I want to know, is it normal for the bank to take a 60k loss, or is our offer amount really not enough to get it approved.
Thanks for all answers
Here in the Washington Dc area, the seller is able to pick which contract they want to go with, and then it is submitted to the bank for approval I know that the bank has to approve it, my question was do you think that they will take that much of a loss?

Answer: All short sales are contingent upon bank approval. This process could take anywhere from a few weeks to months...(just to get price approval) Your lender is correct, you don't have a valid contract until the bank approves and the seller signed contract basically means squat right now. In most cases the banks will take a loss and sell the home for slightly less than Fair Market Value...if it goes to foreclosure they will lose alot more. It is all going to depend on the bank, Fair Market Value of the House and whether or not you have more than one lien holder on the property. If there is a 1st & a 2nd you are going to need bank approval from both.

The last short I did the 2nd lien holder got $1000.00 on a $80,000 note, so they can work (in rare circumstances) Good Luck, consult your agent. Not giving legal advice.

Millionaire Gary Prescott Speaking to Loss Mitigation

If you're new around here, you might want to subscribe to our Upside-Down Mortgage RSS feed. It's quite likely the only feed of it's type on the internet!