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Tina Evans, Real Estate Pro in Dekalb County, TN

On a short sale, can the banks in Massachusetts come back after you for the deficit even if they agree to let

Asked by Tina Evans, Dekalb County, TN Tue Jul 1, 2008

you sell short.

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The terms of the short sale are usually agreed upon before the marketing starts. Obviously check with a lawyer but it is my understanding that the deficit is now an unsecured loan and can be cleaned out via bankruptcy. If you want to keep your credit rating up I would work out a payment plan with the bank.
0 votes Thank Flag Link Wed Jul 2, 2008
there are lots of things no one is telling people who are doing short sales - read my post below.
0 votes Thank Flag Link Thu Jul 3, 2008
Phyllis,,this isn't a legal question. You do not have to have an attorney negotiate a short sale. This falls into the realm of financial responsibility and if the financial institutions are leaning on forgiving the remaining debt or not. Thanks for the reply tho,,,
0 votes Thank Flag Link Thu Jul 3, 2008
..this is a legal question and you really should consult a real estate attorney and let the attorney work out the solution with the lender...

Here is a link to some more helpful information on this subject...

http://homebuying.about.com/od/4closureshortsales/a/shortsal…

Phyllis Lerner
http://www.westchester-real-estate.us
0 votes Thank Flag Link Wed Jul 2, 2008
Short sales do not prevent the lender from getting a judgment against the homeowner for the deficit. In fact, even when it is agreed to in writing during the process of applying for the short sale, that the lender will not pursue future deficit judgments, sometimes they still do. In cases like that, the homeowner has to go out, obtain an Attorney and have them pop off a letter stating to the fact that they have a written agreement that the lender wouldn’t do what they did and therefore the lender should rescind the action immediately.

In other words, unless the homeowner has it in writing that the lender wouldn’t pursue the deficit judgment, then the homeowner maybe up a creek without a paddle. Even if they do, chance are they are still going to have to prove the validity of the agreement sometime in the future because most likely, the big old bank aren’t going to have accurate records and pursue it anyways.

If the homeowner has an agreement, tell them to file it away in a safety deposit box at the bank because they may have to whip it out sometime in the future.
0 votes Thank Flag Link Wed Jul 2, 2008
I've not submitted any contracts yet nor filled out any short sale paperwork with loss mitigation. I've a multi family in Lowell that I need to sell. To hard to manage since I reside in TN. I'm doing my homework first here and fact gathering. I'd rather sell it for what I owe on it rather than short sale, but since the market is down from when I purchased it may have to short sale. Like I said, I'm fact finding right now....Thanks for the answer Michael,,,appreciate it!
Tina Evans, Principal Broker
Web Reference: http://tinaevans.net
0 votes Thank Flag Link Wed Jul 2, 2008
When they agreed not to seek a deficiency judgement, did they give you something in writing? your probably SOL if they didn't :-(
0 votes Thank Flag Link Tue Jul 1, 2008
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