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Doctor Who, Real Estate Pro in Michigan

what is the rule for having a home equity on a home u want to short sale are you absolved from the home equity loan once a short sale has been?

Asked by Doctor Who, Michigan Sun Dec 26, 2010

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Derek Bauer, Door to Dreams...’s answer
Home equity loans are just like any other lien on a property in that the lien-holder must agree to remove the lien so a closing can occur.

If you are researching short sales to position yourself for them, interview them extensively as to their education and experience in closing such transactions. If you are in Oakland, Wayne, Macomb, or Livingston county, we would like to speak with you. If outside of that area, we can direct you to a proven professional.

Happy New Year!
1 vote Thank Flag Link Mon Dec 27, 2010
Dr. Who,

I suggest you talk to an attorney who is a specialist in short sales and foreclosures in mi. The rules change everyday.


Good luck,

Vera
0 votes Thank Flag Link Mon Dec 27, 2010
Generally speaking the second lien holder will take about 10% of the amount owed....this has been my experience and was also discussed during training this past summer during CDPE training.
Web Reference: http://contact4homes.com
0 votes Thank Flag Link Mon Dec 27, 2010
The bottom line, is too get yourself a Short Sale Expert.

MaryANn Denmpsey, C.D.P.E., Realtor & Notary
Keller Williams
0 votes Thank Flag Link Mon Dec 27, 2010
Both lenders will need to approve the sale. More specifically, the primary lender will need to offer something to the secondary lender. I have been very successful with obtaining short sale approvals with no defeciency judgements. Please give me a call so that we can set an appointment to discuss your circumstances and how a short sale works. Thank you.

Charese Brown, SFR Realtor
Community Choice Realty, Inc.
261 E. Maple Rd.
Birmingham, MI 48009
248-506-3733
Web Reference: http://www.plentyhouses.com
0 votes Thank Flag Link Mon Dec 27, 2010
It is a bit more complicated that that! Find a Realtor that specializes in Short Sales! The lender has a lien on your home which can't be sold until that lien is satisfied. Best to confer with 1st mortgage lender and the other lender to determine how property can be sold IF you would still owe money. Also insure, if you are approved for a short sale, you file the proper legal paperwork to insure you do not have to claim the debt that was "forgiven" by the bank as income with the IRS!
0 votes Thank Flag Link Mon Dec 27, 2010
One of the biggest problems with short sales is that if the Junior (in this case your Equity loan) says no then the whold deal can fall apart. The Home Affordable Plan was supposed to alleviate this by paying the Jr lien holder, so far I haven't seen too much speed up. Here is a link to the government website: http://makinghomeaffordable.gov/
0 votes Thank Flag Link Mon Dec 27, 2010
Only professional to render an opinion is the lender on the equity line of credit. The lender has a lien on your home which can't be sold UNTIL that lien is satisfied. Best confer with 1st mortgage lender and the other lender determine how property can be sold IF you would still owe money.

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
972-699-9111
http://www.lynn911.com
0 votes Thank Flag Link Mon Dec 27, 2010
Hey Who;
The mortgage is the primary and the home equity loan is the secondary.
To short the home you'll need lender approvals on the primary and secondary loans.
Good Luck....
Web Reference: http://www.321property.com
0 votes Thank Flag Link Mon Dec 27, 2010
A home equity loan is a lien against your property just like your mortgage is. You cannot sell the home without getting all of the liens released. You will need to get a short sale approval for both loans. This definitely makes a short sale more difficult.

You will need to get your main mortgage company to throw a bone to your home equity loan in order to get them to release the lien. If both companies don't agree and give the approval the sale will not happen.

I hope this helps.

Regards,

Joe Finnerty
484-241-1641
Long & Foster Real Estate, Inc
Lehigh Valley Office, PA
610-865-7776
0 votes Thank Flag Link Sun Dec 26, 2010
No you are not absolved from the home equity loan once the short sale is approved. To receive more information about the foreclosure laws in reference to recourse and non-recourse in your state you can click the link here and select your state, http://www.worldclassmemberservices.com/ForeclosureLaws.html
This is also referred to as the deficient judgment.

In the state of Michigan the lenders attempt to sue for deficiency is often easily defeated in court due to the dramatic loss in property values and how the foreclosure laws in the state are written.
0 votes Thank Flag Link Sun Dec 26, 2010
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