I recently saw a blog where the statement was made that, "Most banks will not stop the foreclosure process and start the short sale process until you have an offer on your home." Our experience is that this is inaccurate advice - let me explain.
The delinquent loan process at the lender has evolved into a two track system. The first track (think a railroad track) is what I call the FORECLOSURE EXPRESS. The lender has come to realize that the loan mod and short sale processes are seldom successful the first time around, are sometimes fraught with ill-intentioned borrowers seeking to drag out the process of losing their homes (or income property), and get tied up in the backlog of the attorney's office and Clerk of Court's office. Thus they put the foreclosure in process "no matter what".
The parallel track of the process is the short sale or loan mod process. This railroad track has chugging along the "LITTLE ENGINE THAT COULD". This engine needs all the help of the broker, seller, attorney and closing agent to move this through the process.
The problem is the FORECLOSURE EXPRESS needs to be slowed down. That does NOT happen with the introduction of a short sale! It is still a race.
Well, you say - this just is not logical. LOGIC!?!!!? When was the last time you used logic in a short sale process with the lender - and you were right???????????
The fact is, unless you yell and scream, and maybe not even then, the foreclosure track does not speak to the short sale track.
So, I think it misleading to simply say that when you introduce a short sale to the lender the foreclosure is stopped, is very misleading and frankly, just incorrect advice.
Copyright 2010 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660 RPZ99@Florida-Counsel.com - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers and Sellers with Short Sales and Modifications and Consult with Brokers and Sellers Nationwide! Shortsales@Florida-Counsel.com New Website www.Florida-Counsel.com.
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