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Short Sales While in Foreclosure

Posted on 01/11/2011 4:04:44 AM PST by hsmomx3

I recently found a full time job after almost two years of not being able to find one but our home is scheduled to be auctioned in February.

I have heard different things and am not sure what to do.

My parents, who live out of state, want to buy the house with cash, free and clear, not for them, but for me and the kids so we have a place to live.

Is this possible? I have heard realtors say it is forbidden, while others say it could be done.

I have not notified the agency who has our home loan but I am trying to work out a modification with them which leads me going around in circles as many well know. I am trying to do whatever can be done to save my house.

I have never been thru this so I would appreciate any advice you can give me.


TOPICS: Business/Economy
KEYWORDS: bankers; foreclosure; iamarealtor; realestate; realtor; reoauction; shortsale; shortsales
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1 posted on 01/11/2011 4:04:51 AM PST by hsmomx3
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To: hsmomx3

Oops..should read SHORT sales......


2 posted on 01/11/2011 4:06:48 AM PST by hsmomx3
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To: hsmomx3

Bad idea. The bank will tie you in knots for the next year. Get out of the place, rent somewhere nice, have your parents buy a different place.


3 posted on 01/11/2011 4:12:24 AM PST by palmer (Cooperating with Obama = helping him extend the depression and implement socialism.)
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To: hsmomx3
There is no restriction on your parents buying the house. The auction is an auction.
Have them buy it and then pay them rent-to-own. You and your family will be safe and you will have the dignity of paying back your family and the self respect in doing so.

Unlike some on this forum I understand that the real world is a hard place. I'm sorry you got in trouble and I hope it works out for you. Always know there are better days ahead.

4 posted on 01/11/2011 4:12:24 AM PST by IrishCatholic (No local Communist or Socialist Party Chapter? Join the Democrats, it's the same thing!)
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To: hsmomx3
Assuming they bought the house or any house and gave it to you, they would have to pay gift tax on any amount over the gift tax limit. Your parents could give you $26K and your spouse $26K without paying the gift tax for 2011. I think they can give more tax free, but it counts against their lifetime inheritance exclusion.
5 posted on 01/11/2011 4:20:34 AM PST by EVO X
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To: beaware; remaxagnt; Ag88; Wonderama Mama; redheadtoo; rbmillerjr; bigsigh; TXBSAFH; gtech

Any freepers who are realtors care to comment about this thread?


6 posted on 01/11/2011 4:27:31 AM PST by hennie pennie
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To: hsmomx3

You can click on “Report Abuse” then ask the Moderator to fix the title for you.


7 posted on 01/11/2011 4:28:40 AM PST by deks ("...the battle of our time is the battle of liberty against the overreach of the federal government")
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To: hsmomx3

Find a realtor who can get it done.


8 posted on 01/11/2011 4:30:01 AM PST by yldstrk (My heroes have always been cowboys)
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To: IrishCatholic

I believe they wanted to buy it before it got to auction. I would pay rent to them, though.

I am not even sure if that is possible—short sale prior to auction.


9 posted on 01/11/2011 4:30:11 AM PST by hsmomx3
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To: yldstrk

I have contacted five and they all refuse to do it and say it is forbdden.


10 posted on 01/11/2011 4:31:07 AM PST by hsmomx3
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To: hsmomx3

It may be illegal in AZ, I don’t know. Having lost my house this year, I can tell you that the bank will tie any short sale up in endless paper if they think they make more money by buying it at the auction and reselling it. Get ready emotionally to move, and secure a lease before the foreclosure. My best wishes to you and your family.


11 posted on 01/11/2011 4:38:41 AM PST by steve8714 (Firing Federal Bureaucrats would have a 1000x beneficial effect on the deficit, naybe more.)
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To: vin-one; Stefan Stackhouse; DCPatriot; texmexis best; dix; TexanToTheCore; The Iceman Cometh; ...

Any freepers who have self-identified as realtors care to comment on this thread?


12 posted on 01/11/2011 4:51:34 AM PST by hennie pennie
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To: IrishCatholic
The bank will want to be assured the short sale is an arms lenth transaction. If the bank is motivated to accept a loss as full payment of your obligation they are restricted to being assured they are getting market and the transaction passes the stink test.

Clearly with your receiving a benefit of reduced rent (and living there after the sale) and your parents potentially receiving a financial benefit. I doubt it passes the requirements imposed by the FDIC.

Also don't forget you will likely receive a 1099 for the debt forgiveness.

13 posted on 01/11/2011 4:55:32 AM PST by JIM O
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To: hsmomx3

Unless there’s some weird law in your state, a short sale is valid at any time. The problem is that most banks take the risk that it will bring more money at auction, and it’s their call. My two cents is that whatever dollar amount your parents are willing to pay, let them buy another property in your area, avoids having them have to bid at auction and may get more bang for the buck.


14 posted on 01/11/2011 4:56:09 AM PST by IAmNotAnAnimal
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To: nufsed
Good Morning, nufsed.

Can you comment on this thread, I saw that you made some very interesting remarks about short sales in this thread:

Short Sales: A Fraying Lifeline for Homeowners

http://www.freerepublic.com/focus/f-news/2355483/posts

15 posted on 01/11/2011 4:59:25 AM PST by hennie pennie
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To: hsmomx3
I think a short sale can be made only be at "arms-length".

Meaning: none of your friends, relatives or business associates can buy the property. Since they get to brand you a "deadbeat" for losing your job that would be considered underhanded.

If the alleged lender or foreclosure mill attorney wants it, whether or not they are the true party in interest would be fine. Same would apply to their friends and relatives. Since they represent the bank, and you signed something on the dotted line they are immune from any and all laws.

Be very careful what you sign and I wish you the best. The best thing for them would be you signing anything they hand you without competent legal representation. The worst thing for them would be filing a Quiet Title action forcing them to prove standing before proceeding to sale.

16 posted on 01/11/2011 4:59:43 AM PST by Chunga85 ("Foreclosure Fraud", TARP, "Mortgage Crisis", Bailout)
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To: 1st I.D Vet
Can you comment on this thread, I see you made a VERY interesting observation about short sales last fall.

THANKS.

Taking on a Second Mortgage to Pay the Foreclosure

http://www.freerepublic.com/focus/f-news/2623209/replies?c=10

"If you do a little research...actuallly, study this foreclosure mess for more than a minute or two on CNN, you'll find that what they're doing makes sense.

"The legal system is gamed in favor of the banks, and unfortunately, the banks screwed up massively in the paperwork and have limited to no chain of custody of title to the properties they try to foreclose on.

"The idea is that 90% of the mortgages out there in the last 10 years are so full of legal holes, that a half assed attorney with a little time can get the bank to go away with its tail between its legs.

"They do a service to society by getting rid of liar banks with liar paperwork and return the house to the owner once the fraud is uncovered. They simply draft up an agreement that once the first mortgage is wiped out, or renegotiated, that the lawyer will be repaid for his and his legal staffs time for the work and court costs they incur in the process.

I know two companies which have been successful and making these things go away after a little courthouse work is done. wild times we're in...

msfraud.org
livinglies.wordpress.com
foreclosurehamlet.com

12 posted on 11/07/2010 3:32:50 PM PST by 1st I.D Vet

17 posted on 01/11/2011 5:10:58 AM PST by hennie pennie
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To: hsmomx3

Your parents should find a lawyer that deals in “short sales” The bank, however, may not cooperate with you. THe local bar association can point them in the right direction.

Good Luck


18 posted on 01/11/2011 5:19:33 AM PST by Citizen Tom Paine (An old sailor sends)
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To: Kolokotronis; null and void; Hoosier-Daddy; 11johara28; irish_links; FromLori; blam; muawiyah; ...
*ping*

A fellow freeper needs advice in this thread, any of you care to assist her? OR know of any freepers knowledgable about short sales following foreclosure?

Thanks much.

19 posted on 01/11/2011 5:23:45 AM PST by hennie pennie
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To: hsmomx3; KoRn; G-dzilla; Dianna; Tidbit; Repeal The 17th; chopperman
Say, hsmomx3...

Apparently, IF there is a successful short sale to your parents, you will have to claim the money on your tax return as "debt forgiveness" ... OR something; sounds like a CPA and an attorney, as well as a realtor would be needed to confer with about the best option for you.

20 posted on 01/11/2011 5:41:58 AM PST by hennie pennie
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