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In an approved short sale which closed the bank did not release the deficiency- how does the seller negotiate for a very reduced settlement?

By Marsha Montoya Mayer

Real Estate Agent with Paradise Properties of Florida, Inc.

November 08, 2010 03:58 PM

In a Florida approved short sale which closed, the bank did not release the deficiency - how does the seller negotiate for a very reduced settlement?

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Maria Morton

Platinum Realty - Kansas City, MO

Kansas City Real Estate 816-560-3758

Marsh, I always get the bank's release in writing for the seller as we are negotiating the contract. Once it's closed, what leverage does the seller/owner have to negotiate with the lender?

Nov 08, 2010 04:01 PM

Rebecca Nystrom

RE/MAX Renaissance - Phoenix, AZ

Wait until the lender contacts the seller. I have been told it will be like any other collection and it can be negotiated down. I personally would see if they would release the collection for 10 cents on the dollar.

Nov 08, 2010 04:17 PM

Marsha Montoya Mayer

Paradise Properties of Florida, Inc. - Palm Beach, FL

Yes, Maria, I try to do that, too. But in this case it was a 2nd lien holder that would not release the seller from the deficiency. They got $3,000 from the 1st but the investor for the 2nd would not release it. The Seller decided to accept the short sale rather than let the property go to foreclosure AND then negotiate after the fact.

Now I am asking for advice on how one would most effectively settle the deficiency for the minimum amount.

Nov 08, 2010 04:20 PM

Tony & Darcy Cannon

Aubrey and Associates Realty - Layton, UT

The C Team

Marsha, those second mortgages are really being a pain. I know of at least two deals that went into foreclosure rather than a short sale because teh 2nd wouldn't negotiate. I will check back to see what you find out!

Nov 08, 2010 04:56 PM

Thank you Rebecca, I think waiting would be a good idea. But even at 10 cents on the dollar that would still be $8,000 that the Sellers really don't have.

Nov 09, 2010 01:10 AM

Tony and Darcy, In my experience my del is the only one I know of where the 2nd asked the 1st for the same amount the 1st was willing to give ($3,000).

But, now what can the bank do to collect this debt? is the question I have been asked.

Nov 09, 2010 01:13 AM

In an approved short sale which closed the bank did not release the deficiency- how does the seller negotiate for a very reduced settlement?

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