Foreclosure in Illinois>Question Details

k9murph, Home Buyer in Illinois

We live in Illinois. The mortgage company approved the short sale but with a deficiency waiver if we pay $25,000. The 1st and 2nd loan are under my

Asked by k9murph, Illinois Fri Nov 2, 2012

husband's name. We do not have that kind of money to pay and we are negotiating. They say that I have other bank accounts that I can contribute. Those accounts are listed under my sons names for college and I am listed on there as well. They each have $,5,500 saved. Does the mortgage company have the right to ask me since the loan is just under my husband's name?

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With improvements in the market my Short Sales are getting harder to approve. What one lender considers a "hardship" another may not, what one considers an ability to pay or amount of funds to bring to closing another may not.

Speak to your attorney. Your attorney should be able to help you negotiate that amount and/or a deficiency waiver. Some of my recent short sale closings have been asked to pay the outstanding tax amount, bring money to closing on the 2nd loan, bring funds to closing on the first, etc..

Good luck!
0 votes Thank Flag Link Thu Nov 8, 2012
The lender has legal right to file for a "deficiency judgement" in the process of approving of short sale. Your attorney's job is to convince the lender not to pursue it due to seller's inability to pay and financial hardship. In many cases, lenders give up on deficiency judgement because it is almost an automatic "deal killer"
0 votes Thank Flag Link Sun Nov 4, 2012
You need to get an attorney who deals in short sales and foreclosures to help you and ensure you are protected. I have never heard of a bank asking for money, but that doesn't mean it doesn't exist.

I would speak to an attorney before giving a cent so you know your rights and options.

If you don't want to contact an attorney, you can contact IDHA for free - Illinois Housing Admin. See below for information. They can help you with options too.
0 votes Thank Flag Link Fri Nov 2, 2012
I do have an attorney. The 1 st mortgage approved the short sale but will not waive the entire deficiency. So they came back with $25,000 as a reduced amount compared to $110,000 that we are underwater. Since the loans are under my husband's name, does the bank have the right to ask me to pay the deficiency with accounts that my sons have for college in which I am listed since they started this account as a minor? I understand IL is a common law state.
Flag Fri Nov 2, 2012
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