Foreclosure in Framingham>Question Details

Ray, Home Seller in Framingham, MA

Need to understand the implications of a reservation by the lender in a short sale for a deficiency judgement

Asked by Ray, Framingham, MA Thu Jul 9, 2009

Hello

I am in a short sale situation on my home owing to relocation. After 2 months of waiting, I got a letter from my lender confirming they have agreed to the short payoff. My happiness was short lived though when I read in the letter that they reserved a right to pursue a deficiency judgement for the difference.

I am not sure if this is just a generic clause which lenders include or whether to read more into this. I have already called the buyer and informed him of the approval. The lender has given me 40 days to close. Not sure how to resolve this. Should I follow up with the lender to get the clause omitted? Would the lender oblige? I am afraid that the lender will demand a sum of money from me which I cannot pay.

Appreciate any help in the matter

Thanks
Ray

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Answers

3
First of all thanks a lot for your inputs.
From your responses it appears to me that the clause regarding the deficiency judgement is not a generic one. So is the amount that the seller has to contribute clearly indicated on these demand letters?
I am yet to sign my agreement to their demand letter. In the same letter they state that they could require a promisory note from me but also confirm that this will be of zero value. Its pretty confusing esp to someone like me.
I guess an attorney is my best recourse but before I started talking to attorneys, I wished to check with other sellers who might have experienced a similar situation. So I can convince myself that the dollars paid to the attorney is worth the money
0 votes Thank Flag Link Thu Jul 9, 2009
Who represented you in the negotiation?
The bottom line is that you should know BEFORE YOU AGREE what the options may be.
At this point I would suggest paying for professional legal counsel.

They have attorneys. Why don't you?
0 votes Thank Flag Link Thu Jul 9, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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Hello Ray, you will gt a lot of suggestions on this board. My suggestion is that you get professional legal advice. Only a lawyer can help you weigh your options. Of course you probably don't want to spend $1000 on a retainer, you don't have to. You can purchase legal insurance for the cost of 2 movie tickets & popcorn per month.
0 votes Thank Flag Link Thu Jul 9, 2009
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