As I mentioned in one of my previous posts some short selling owners are getting offers which are rejected by the lender. Very few buyers are willing to buy a short sale listing for market value. Some lenders are willing to negotiate deeds in lieu of foreclosure. But, what if your client wants to know what they should do?
What are the ramifications of a deed in lieu vs a short sale?
I am sure many of you already know the answers. But now I am going to give you a real life concern.
What happens when the NOD gets filed.
What should a good legal advisor do?
A representative from Countrywide told me - your client can do a deed in lieu as long as you don't wait too long. I asked how do I know when too long is. She said well you need at least two months before the sale.
And then she sort of asked if the short sale process takes about 4 months in CA. I said that would be about the minimum but I said it looks to me like you send out notices but don't always start the process right away.
Which brings up a difficult choice for all owners... Right now countrywide has a deed in lieu track and a separate short sale track. How can anyone (lawyer or Realtor) make that choice for a client.
All you can do is give them good info. And some of that info must include the ways they can use the court process to slow down a sale. There are legal ways to slow or p
erhaps even prevent a foreclosure sale. But you can't wait to the last minute to bring a lawyer on board. Most lawyers will not review a case if they do not have time to come up to speed. Once that NOD shows up, someone who holds themselves out as a fiduciary - has to start making sure the client is properly advised. This whole process is filled with traps. If your seller all of a sudden your seller gets upset and says why wasn't I on the deed in lieu track - how they heck can a Realtor even respond? No response will satisfy a plaintiff's attorney. (actually all your responses but one will please the plaintiff's attorney)
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