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Short Sale Seller Does the "Right" Thing

Promissory Note

Today I got a call from a short sale seller. He already listed his house with another Realtor, but had read my blog and wanted to tell me about his scenario. I think he wanted an "ear" to listen to his story, and give him some reassurances. I was happy to oblige. The gentleman had done a cash-out refinance on his house several months earlier- receiving about $15,000 back from the transaction. Since then, his fortunes had plummeted, his roommate had moved out, and he could no longer afford his mortgage payments. His mortgage was backed by FHA, and he told me his lender had given him an acceptable price at which the property could sell. He got lucky, and now has an offer. His short sale package is at the bank awaiting approval. His fears were that he had taken out the $15,000 cash from the refinance, and that based on that, his short sale would not be approved. He said his file was in line for review, and he wanted to "do the right" thing and write a letter stating that he would pay back the extra $15,000 in the form of a promissory note, as he has no savings. He asked me if I thought that would help his case. Sure, perhaps the lender would approve his short sale without a promissory note, or perhaps they would reject the offer, or maybe they would ask for a lump sum payment. But what he wanted to do, to make things right with his conscience and his personal code of conduct, was to pay back that money. And that's what he is doing.

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Posted by Wendy Rulnick "Its Wendy!" Destin Short Sales on 10/08/2008 05:54 PM

Comments (19)

Short Sales in the Sales Strategies / Tactics Channel

short sale promissory notes, destin short sales, destin realtors, short sale approval process

Originally posted at: Destin Short Sales- Emerald Coast Florida Real Estate: Short Sale Seller Does the "Right" Thing

Post is included in group: Foreclosure Help and Prevention
Post is included in group: Sharing Information of Short Sales
Post is included in group: Short Sale REALTORS®
Post is included in group: Short Sales Pre Foreclosures Bankruptcy and More!
Post is included in group: Short Sales Specialists

19 Comments on Short Sale Seller Does the "Right" Thing

OCT

2008

Every short sale I have done or heard of the people do not want to pay the bank anything or they do not have any money. That is really refreshing to hear that someone feels that they should pay back what they have borrowed.

Wendy...hopefully this seller will call you when he's ready to make a purchase in the future. Usually it turns out that way (or you hope it does) when they have a Realtor, but they turn to you for advice. I know you are in close proximity to South Florida but I could tell the seller is not from Miami. Give back $15,000? That's an honest seller!!

Norma - It was inspiring to hear his story.

Sergio - He said he would call me to let me know how it all turns out. (You know something about Miami I don't? :) I am 12 hours away in Destin FL)

Wish there were more sellers like him. We wouldn't be in this mess if there were.

Impressive! Like Norma, I generally find that folks who are in a short sale situation go the other way. Good for him!

Curious why he contacted you? Doesn't trust his Realtor or did he just see you as an expert in the field?

It's great that he wants to do the right thing. It put you in an akward position, though, as he was asking you for advice while under contract with another agent. I see "messy" here: the risk of implied agency and the possibility of the listing agent fuming at any perceived interferance if he didn't like your input to the seller. I hope it goes well for him and that there are no bad repercussions for you.

Wendy, That's excellent!! He should be all means write the letter. I am working with quite a few short sale sellers and some want to do the right thing but more feel they are entitled.

Wendy, I am new to Active Rain, but am familiar with foreclosures, short sales and bankruptcy. My back ground was on the loan servicing side and I must say I am very impressed with your blog and web site!!

Wendy...I get the feeling that there are very few people in Miami that would think about returning the $15,000. I ran into one seller the other day that when I researched the public records found that they pocketed $50,000 or so on a transaction and a few months later started to miss their mortgage payments. Unless he went to the Bahamas on a junket and put it all on the blackjack table......

Angelia - He's a first.

Brett & Mary - I asked him why he contacted me. I told him I wasn't an attorney. He said he felt his agent was inexperienced. I told him he had to do what he felt was right. Believe me, I always use caution and qualify any discussion. I think he just wanted to "say" what he already "felt" to someone else.

Bryant - That's cool. And I "hear ya".

Keith - Thank you so much.

Sergio - That's scary (and sad).

OCT

2008

God Bless America - isn't it refreshing to hear of the good souls still around!

OCT

2008

Lynn - Ditto!

I think this seller did the right thing, and it shows he is willing to cooperate.

Mike - And he took the initiative....

OCT

2008

I agree. He did the right thing. I would have probably done the same.

I have a listing that is a short sale and my client and I have already spoken to the 2nd lien holder and have told them that he is willing to pay back the balance of a 410,000 that he borrowed about 1 1/2 years ago for a kitchen redo. I gave my client alot of credit for being willing to do this. It is nice to know there are others like him.

Thea - You and not many.

Debra - That's really awesome!

OCT

2008

Wendy, It is refreshing when you hear stories of people wanting to do the right thing. Hopefully, his bank will lay out a couple of option for him so that he may choose the best one that will work for him.

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