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Q: I have a couple of questions. 1. Can I legally buy a short sale from a friend? 2. If I am able to buy the house from her, Would she be able to rent a room from me, and it be legal?
A: If you are acting independently, yes, you can legally buy the house from your friend. Lenders are trying to stop short sale fraud by having all parties sign an "arm's length transaction" disclosure, which discloses whether there are any family relations involved. This means that the buyer can't be "related" to the seller, and the seller must be acting in his/her own self interest. After you become the legal owner of the house, you can rent a room to whoever you please.
Recently Asked Questions
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Q: I have a couple of questions. 1. Can I legally buy a short sale from a friend? 2. If I am able to buy the house from her, Would she be able to rent a room from me, and it be legal? A: If you are acting independently, yes, you can legally buy the house from your friend. Lenders are trying to stop short sale fraud by having all parties sign an "arm's length transaction" disclosure, which discloses whether there are any family relations involved. This means that the buyer can't be "related" to the seller, and the seller must be acting in his/her own self interest. After you become the legal owner of the house, you can rent a room to whoever you please. |
Posted By kelly mccarthy Apr 25th, 2011 07:37:56 PM |
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Q: what if as a short sale buyer the tittle company already wired the money from my account ,but after 3 weeks the sale is not closed and I don't have the property. A: Contact the title company first and ask for an update on the title transfer. Delays in this process are not uncommon, but you must be duly informed of any problems. If it's taking too long, consult a short sale attorney to learn more about your options. Make sure to have all the hard evidence on hand, such as the purchase offer, contracts, and any subsequent modifications. |
Posted By helene Apr 23rd, 2011 04:56:22 PM |
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Q: I sold a single family rental property in Michigan in Feb 2011.The sale was via Short Sale. After the closing the lender later issued me a 1099 @ the full balance owed + indicated the amount of the sheriff sale. My accountant said he could not claim the 1099 on my 2010 taxes. I am very confused because now the lender is calling me for payment on the the balance due from the short sale. A: Doing a short sale doesn't always mean you'll walk away from the house free of debt. Most lenders will issue a 1099 to the seller for the balance deficiency, meaning you will have to pay taxes on the difference. Negotiating this deficiency is key in a short sale. Your short sale agent should have talked to you about it before you signed the contract. You can't file your 1099 with your 2010 return because the short sale took place on 2011. |
Posted By Myrah Smith Apr 21st, 2011 03:37:04 PM |
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Q: how can i get paid the $1500 to $3000 to move out of my foreclosed house before I am evited A: You can try negotiating a short sale or deed-in-lieu of foreclosure through the government program HAFA (Home Affordable Foreclosure Alternatives). If you qualify for either of these, you can be freed of your debt and receive up to $3,000 in relocation assistance. Contact a professional short sale agent to help you through the transaction.You can try negotiating a short sale or deed-in-lieu of foreclosure through the government program HAFA (Home Affordable Foreclosure Alternatives). If you qualify for either of these, you can be freed of your debt and receive up to $3,000 in relocation assistance. Ccontact a professional short sale agent to help you through the transaction. |
Posted By Gail Apr 17th, 2011 04:36:59 PM |
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Q: Can a 2nd lien holder stop a short sale if the 1st lien holder have approved the sale, with an offer of $5,000 to the 2nd? A: Yes, the second lien holder has the power to stop the short sale. This will rarely occur, though, because if the property gets foreclosed the second lien holder will get nothing. To improve your chances, work with a qualified short sale agent with good negotiation skills. |
Posted By Repole Allwood Apr 8th, 2011 01:20:52 PM |
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Q: I sold my home as a short sale in May 2010. I have started the process to purchase a new home and expect to close in two weeks. My husband is active duty military and we have already been prequalified as well as signed disclosure papers. However our lender is now questioning the short sale due to new laws that came out in February. Can our short sale prohibit us from closing? A: The new short sale law, SB 931, concerns deficiency judgments on short sales and has little bearing on the purchase of new homes. However, older regulations may keep you from getting a mortgage so soon after a short sale. Unless special circumstances apply (for example, you had good credit standing at the time of the short sale), you may have to wait at least two years to be able to buy a new home. Note as well that there's a difference between pre-qualification and pre-approval -- being pre-qualified only means the bank has looked at your credit score and income, while pre-approval takes into account your payment history and other records, including previous short sales and foreclosures. |
Posted By tonya Apr 6th, 2011 10:31:31 AM |
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Q: On a short sale are you required to payoff the difference between the sale price and the balance owed to the lender? A: This will be up to you to negotiate with your lender. Unless you do a "HAFA Short Sale" your lender could seek a "deficiency judgment". |
Posted By Amy Nov 5th, 2010 12:35:59 AM |
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Q: during the shortsale process are you required to make ful mortgae payment A: You're not precisely required to make a payment, it all depends on your situation and if you are able to make it or not. If you decide to not make your mortgage payment foreclosure will not stop, and it will have a negative impact on your credit score. |
Posted By John Nov 4th, 2010 08:48:27 AM |
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Q: I want to buy my wife house through a short sale. I am not on the loan and we are facing foreclosure. If the bank does agree to the short sale, will I own the home which will allow my wife and I to keep the home? Respectfully, Kim A: No. To try and do this would be considered fraud. Before they approve your short sale, most lenders - if not all, will make you a sign a document where you acknowledge you are not related or affiliated to the buyer. |
Posted By Kim Patillo Oct 21st, 2010 11:35:45 AM |
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Q: made a cash offer on house. accepted by seller and was then told it would be a short sale. agent told me seller had been negotiating for a short sale with an attorney and accountant. is this legal? A: The lender must first approve a short sale before the seller can accept the offer. If it is truly a short sale there should be a short sale addendum attached to the contract. Is your offer less than the amount owed on the property? If so, then it is a short sale and first need lender approval. |
Posted By c. scott Oct 18th, 2010 01:16:46 PM |
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