This one posed some huge challenges, but in the end we all were able to walk away happy.
3 lien FHA short sale. Yup you heard me right. I knew this was going to pose some challenges, but was confident in my ability to get the job done.
1st lien - Chase FHA. Fairly straightforward here, Chase has been greatly improving their responsiveness to complete short sales. We had the client into the HUD Pre foreclosure sale program 27 days from the day I faxed a full package. The negotiator at Chase was a dream to work with.
2nd lien - Flagstar Bank - Here is where things got a little hairy. Flagstar was very slow and unresponsive to phone call after phone call. They had a huge 2nd mortgage on this (65k), and the max allowed to Jr. lienholders is $2500. Finally after 3 solid months of weekly phone calls, I got a rep that actually knew what they were doing. He stated at the time, I don't know why this letter has not gone out to the homeowner yet, I'll drop it in the mail today. This "letter" ended up being a borrower HAMP/HAFA rejection and request for non HAFA short sale form. My client filled it out, I faxed it in, and the NEXT MORNING, I had an email from a negotiator.
Flagstar negotiator- "I have ordered appraisal and title work"
.....this set off an alarm in my head.
Patrick- "You need appraisal and title? You guys are in 2nd position on an FHA 1st. I can get you $2500 if we close by this 2/12, and $2250 after 2/12."
Flagstar negotiator - " I just realized this is a 2nd mortgage. ( Really guys? Come on!) Do you think the buyer can close by 2/12?"
Patrick- " If you get me an approval letter by tomorrow, yes".
Next morning, what should arrive in my email, but an approval letter from Flagstar bank!!! Woot! Woot!
3rd lien - Judgement lien - My clients attorney, Timothy G. Kearney was able to secure a release and clear this way in advance of our closing and it cost our mutual client less that 10 cents on the dollar! Way to go Attorney Kearney!
The details-
Sale price - $123,000
Allowed closing costs - $12,000
Net to Chase FHA 1st - $111,000
Owed on 1st mortgage - $200,000
1st mortgage debt forgiven - $89,000
Flagstar bank 2nd mortgage-
Net to Flagstar 2nd mortgage - $2,500
Owed on 2nd mortgage - $65,000
2nd mortgage debt forgiven - $62,500
Judgement lien-
Owed - $14,000
Settled - $1,250
Judgement lien debt forgiven - $12,750
Total debt forgiven - $164,250
All in all, not a bad 4 months at the office! :-)
Patrick
Need to sell your home? Why settle for less than 5 stars? 2011 and 2012 Five Star Connecticut Magazine real estate agent.
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