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merima   zeh…, Renter in Nashua, NH

put house for short sale ..there is 2 mortgage involved how will they split money ????

Asked by merima zeher, Nashua, NH Wed Sep 7, 2011

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Most of the money goes to the first lender. So let's say you owe $280,000 and you get an offer on your property for $220,000. If the first lender was owed $250,000 and the second $30,000 the first lender will dictate the payout to the second lender. Usually 10% is the amount I've seen, but it could be more or less, so for example with the $220,000 offer 10% of the original loan for the second lender was $30,000 and the first lender may offer the second lender $3000. So lender #1 would get $217,000 and lender #2 would get $3000. Of course those are gross numbers..just to give you an idea.
Here is an example of a short sale approval with two lien holders for Bank of America:…

You can read and see what BOA allotted the second lien holder -
Now the tricky part is to get the second lien holder to ACCEPT the amount they are being offered by the first lien holder. Sometimes they hold out for more money and then you have a problem on your hands.Greentree for example is known to want close to 20% of the loan balance. You have to make sure each lien holder is satisfied or you will have NO SALE.

Sometimes you may get enough to pay off the first lien entirely but not the second and in that case, you are only going to do a short sale on the second lien.

Good Luck!
0 votes Thank Flag Link Thu Sep 15, 2011
Hello Sana40,

The companies holding the mortgages will negotiate with one another
about how much each will take. You will not have a voice in their

Best of Luck,

0 votes Thank Flag Link Wed Sep 7, 2011
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