Foreclosure in Grand Mound>Question Details

glorihallj, Home Owner in Centralia, WA

Have home up for short sale, buyer now wants us to put down at least $500 to help pay for a new roof. We had a 1st and 2nd mortgage with same bank.

Asked by glorihallj, Centralia, WA Tue Oct 8, 2013

We are now threatened that if we do not pay the $500 the bank could foreclose on us and in the future the bank could come back on us for payment on the 2nd loan. The bank did agree to forgive both loans.

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3
Gloria,
It's hard to give you much of an answer without a lot more facts. First, if your short sale has been approved and after the fact you are dealing with inspection issues, it could be as you've indicated. The buyer is asking for a contribution toward the roof which is small in relation to the cost of most roofs. As a short seller however it is assumed you are in financial difficulty. While this has to be the case to some degree or the bank would not approve it, the degree of hardship can vary quite a bit. If you've been living in the home without making payments for several months, it may be possible for you to come up with the funds. On the other hand if the issue that put you in financial distress, loss of job, health, marriage, etc hasn't been addressed you may not have the resources.
I guess my simple advice is to understand your options as best you can and do what's best for you. As Kary indicated, an attorney review is a wise thing to consider. While this will cost some money, it's about more than just the $500.00. If you don't already understand the full ramifications of a short sale, foreclosure and Bankruptcy, it would be good to know while you still have options available to you.
One last thought about the roof, offer something. If you can only do $100, make it available and see what the buyers say. In most cases, getting a short sale wrapped up is a major accomplishment and the buyer's may be willing to take what they can rather than start over on another property.
0 votes Thank Flag Link Tue Oct 8, 2013
Your lender is going to approach any offer from a risk reward standpoint. I would ask your agent to contact the lender and submit a short sale package as soon as possible to determine the amount of loss they are willing to consider. In many cases they may be servicing the account for the actual owner of the proeprty and may have to get additional approvals which can be time consuming.
0 votes Thank Flag Link Tue Oct 8, 2013
It sounds as if the banks have already approved the deal.
Flag Tue Oct 8, 2013
While perhaps not common, it's not unheard of for a seller to contribute to repairs on a short sale. Based on only the facts you give it seems like an easy decision.

I would suggest though that you ask your agent and if you have not done so already, consult an attorney about whether a short sale is really in your best interests. If it is, $500 seems like a low price to pay. As I mention in the following link, getting the deficiency on a second loan waived is one of the best reasons to do a short sale (assuming no tax impact). You might also want to read the other piece linked which is the reasons to not do a short sale (the "or not" part).

http://www.trulia.com/blog/kary_l_krismer/2012/08/do_you_wan…
0 votes Thank Flag Link Tue Oct 8, 2013
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