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.
They may be a treasure trove of accurate advice.
Contact your local legal aid and find out if you can have an appointment with some realty-saavy attorney who might be able to correctly advise you, according to the specific laws of your state.
Over the past half dozen or so years here at FR, I've read many freepers complain that they weren't able to buy any property on SHORT SALE, as the qualifications/regulations were out of this world, and that anyway, it seemed that the banks are not interested in selling their foreclosed homes, as they appear to be making the process extremely difficult.
There MUST be a way that you can get competent legal & financial advice, either for free or at an extremely reduced price given the fact your income has been so low for so long.
or the bank will accept no bids and eventually someone in the bank or some friend of someone in the bank will get the house
Have you or your parents got an attorney who can advise you on the law (the bank may not be honest about this, I would not expect them to be)
Can you sell your house at this point, in lieu of auction?
FIND OUT YOUR RIGHTS.
If not your parents can get advice about entering the auction, but I wouldn't hold my breath
Your parents sound wonderful, they can certainly give it a try to bid at auction, but can then help you out by looking For another place
I've read that banks are NOT being helpful in the sale of either short sales or foreclosed properties, and that they want to make money..... but I had NO idea that they were using these properties as "favors."
Should Attorney Generals of the states prosecute against such bad practices by the banks?
You could fight the foreclosure and stop it then do what you want with the house.
http://livinglies.wordpress.com/
Google issues like stop foreclosure now.
I don’t know where in Arizona you’re at but you need to contact these guys, if they can’t handle your short sale then they would be the ones to know who in your area would be the best to do it. These guys are incredible, more like phenomenal. They apparently are very religious as well, which would seal the deal for me should I be in your position.
This website I’d say is more for other agents trying to do short sales and needing education, but check it out nonetheless. If your home is scheduled for auction, do not delay any further and have your situation evaluated by the most competent Realtor you can find (these guys if possible) If you get an offer before the auction, the bank will pull it from the auction block. I don’t know if AZ has a redemption period or not, but if it does, you can continue to live in your home til the sheriff says you must vacate. You could be saving up your money in the meantime and looking for another home and with your parents help (you are blessed my friend!) you can be on the road to recovering and repositioning your credit and your life. The main thing with a short sale is to save your credit to the extent that it can be salvaged, not stay in your home. Realtors can and have helped folks with the loan modification process too, for a fee they will help you.
Since you’re in AZ, call these guys, they will either help you personally or point you to someone competent enough to help you through this. Either way, don’t it NOW, time is not on your side.
shortsalepowerhour.com
Most banks (if they approve the short sale) will forgive the outstanding balance. Obama signed an order a year ago that allows this “income” to be not taxable. Otherwise don’t sign and let it go to forclosure or tie it up in the above mentioned ways in the courts and rent it for as long as you can. Sign a lease with the renter that protects the renter in the case of a foreclosure.
Bless your parents, they are wonderful.
don’t = do it NOW
(my pulse rate and IQ are way down- need more coffee:)
BTW, what the agents are telling you is true. Your parents or any relatives or people acting on your behalf CAN’T buy the home your living in on a short sale for you to continue to stay there. Even a perfect stranger to you can’t buy your home and then turn around and rent it back to you. It’s the law I’m afraid. Banks have been slammed with scam after scam and that is just not an available option to you. Also, there is such a thing as a deed-in-lieu of foreclosure, which is the between full blown foreclosure and short sale on the scale of what is most damaging to your credit.
Your parents should find a lawyer that deals in “short sales”
They might advise whether a corporation owned by the parents could take title to the property, circumventing the family relationship concerns.
Also, to those who suggest that many mortgages are invalid because of some paperwork deficiency, be advised that in virtually every case, the bank can fix the deficiency. They will and they do, and it’s not worth the bother to try this gambit.
A short sale can be done prior to the auction IF the bank will accept the loss.
IF there is a successful short sale to your parents, you will have to claim the money on your tax return as “debt forgiveness”
For those who bought low, mortgaged high, blew the dough, and can’t make the payments, they have tax troubles and little sympathy from me.
See #13. I am doing a short sale purchase and I had to sign a statement that I had no financial interest, etc with the sellers.
Also if you do a short sale you must pay the bank the balance of the loan due on your house.Say you sell and it does not cover 30,000.00 you owed on the house you will have to pay them back even if it is sold.
You also need a good attorney to represent your interests.
The basic difficulty in getting a short sale property is that the bank wants at least market value for the short sale. Most buyers don't want to wait four months to buy at market value when they can get another (or new home) in just a few weeks.
The potential for people to game (fake hardship to get out of a loan) this type of scenario is why it is not allowed.
First, the bank does NOT control the auction. Second, the sale goes to the highest bidder, not to someone the bank owes a favor to. Third, the bank CANNOT require that no bids are accepted. Fourth, your advice stinks.
Our first offer was submitted to Wells Fargo, within 1 week we heard back from the bank that they received it, I got a contact number and transaction number and they extended the forclosure date two months.
We had to sign an affadavit that is was an "arms length" transaction, certifying the buyer was not a family member, friend or that they would sell or rent the house back to you, so the parent option is out.
The buyer withdrew from the first offer and now we have received our second offer. From my understanding most banks will extend the foreclosure date three times and try to make a short sale work. Although it takes some time and you have to have a very patient buyer, your credit will be saved and the bank prefers that you stay in the house.
After a short sale is complete in most cases the credit report is marked paid in full and you can have good credit and maybe even buy a house as soon as 12 months of no late mortgage payments. A foreclosure on your credit report will hurt you for 3-7 years.
I have found that Bank laws trump state laws, so whatever your state law is concerning loan and sale behavior the banks totally ignore it.
Stay in your house, hire a Realtor to list it (if you get no's find the short sale expert) and then get the necessary paperwork in for a short sale. I had to fax 67 pages of documentation, the Realtor will do it and the bank will pay the commission and maybe repairs if needed for financing.
See my previous post. SL is out to lunch on his advice.
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