Home Buying in Eastlake>Question Details

Bryan, Home Buyer in South Delridge, Seat...

Does a rental/non-primary residence qualify as?

Asked by Bryan, South Delridge, Seattle, WA Tue Jun 3, 2008

If the property was being used as a rental i.e., not the owner's primary residence, does the new distressed property law affect a short sale of it? It looks like it doesn't apply since it's not the distressed homeowner's primary residence ... Do I read this wrong?

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Personally I think the same ethics should apply whether or not it's a primary residence.
1 vote Thank Flag Link Sun Jun 8, 2008
No, investment property does not qualify for the new law.
0 votes Thank Flag Link Sat Jun 28, 2008
Bryan - you are reading it correctly as stated below:) Amazing considering the language and the law in general -
Good luck with the short sale!
0 votes Thank Flag Link Fri Jun 13, 2008
No you are correct , it applies to primary residence ONLY not rentals or second homes or vacant land. It is a little gray the way it is written and we can all look forward to many form revisions...Tom
0 votes Thank Flag Link Thu Jun 12, 2008
A short sale may not be a distressed property. However, the law only applies to a primary residence. Everyone should be aware that this law excludes very few categories of individuals, like mortgage brokers. It INCLUDES both agents and members of the general public who may become distressed property consultants without their knowledge.
0 votes Thank Flag Link Tue Jun 10, 2008

The new distressed property law does not apply to non owner occupied dwellings.
0 votes Thank Flag Link Sun Jun 8, 2008
I want to clarify that I am talking about the "distressed sale" of the primary home of a seller.

A seller who is selling their home for normal reasons is not a distressed seller and not the subject of this new law.
0 votes Thank Flag Link Tue Jun 3, 2008
Hi Bryan,

Only the sale of the owner's primary home is affected by the new law.

If this was a primary home, under the new law, there will be some brokers and agent swho will choose not to take on the additional liability and decline to represent a buyer in such cases. Buyers could also have liability if they end up as as a fiduciary to the seller if (when) the home is under a 20 notice of a Foreclosure Sale once there is a mutually accepted P&SA. and the home is STI or Pending.

Since in your example, the home has been a rental, this is not an issue beyond the normal challenges of short sale. Any agent you choose to represent you can, and not have the additional liabilities in the above paragraph.

Good luck with your purchase Bryan!
0 votes Thank Flag Link Tue Jun 3, 2008
Hi Bryan,

Two part answer. As I read the new law, Distressed Home has to be the owner's primary residence, thus it would not fall under the new law. Second part is an investment property can be a short sale and would fall under that part of the listing agreement and NWMLS forms. I would check with my Broker and my local real estate attorney before proceeding.

Good luck,
0 votes Thank Flag Link Tue Jun 3, 2008
An agent cannot represent you in an unlawfull transaction and we have a legal duty to disclose what we know.
My understanding of the actis that it is to help homeowners and not investors.
Real estate agents cannot give tax advice or legal advice. We refer you to those professionals. We could sell the house but you would need to talk to an attorney and a CPA on how to file your taxes or anytoher legal question that the sale brings up.
0 votes Thank Flag Link Tue Jun 3, 2008
Jed Lane, Real Estate Pro in San Francisco, CA
Besides the legality, would agents here take on such a sale on a buyer's behalf?
0 votes Thank Flag Link Tue Jun 3, 2008
Jim is correct to defer to an attorney. If, as real estate agents we give legal advice then we are held to the same standard as an attorney. But, yes, my understanding of the law is that it only applies to a homeowner's primary residence.
Web Reference: http://www.HomeHounds.com
0 votes Thank Flag Link Tue Jun 3, 2008
Legal questions should be addressed to an attorney.
0 votes Thank Flag Link Tue Jun 3, 2008
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