Crazy Short Sale Situation

[Toby Lane]

This is a new one on me, hopefully someone else has had a similar situation. My buyer puts in a offer on a short sale of $155k no closing cost. Listing agent comes back and says the Mortgage Insurance Company wants the seller to sign a $20,000 promissary note to pay them back or the lien holder (the bank) can't accept our offer. The seller says no, I'm not signing that, I'll let it go into foreclosure. The listing agent comes back to us and says we will sale the house at $140,000 with $4,000 closing cost. $19k in favor of my buyer, if my buyer agrees to pay the MI company $10k. She is hoping MI company will take the $10k as a comprimise and my buyer ends up $9,000 in her favor. Anyone ever heard of anything like this?

[Micheal Pannell Realtor]

My mother has a crazy one like that going now. There is a collection company involed

[AugustaREGroup]

What in the world? Keep us updated how this one turns out

[satxproperty]

This is a new one on me, hopefully someone else has had a similar situation. My buyer puts in a offer on a short sale of $155k no closing cost. Listing agent comes back and says the Mortgage Insurance Company wants the seller to sign a $20,000 promissary note to pay them back or the lien holder (the bank) can't accept our offer. The seller says no, I'm not signing that, I'll let it go into foreclosure. The listing agent comes back to us and says we will sale the house at $140,000 with $4,000 closing cost. $19k in favor of my buyer, if my buyer agrees to pay the MI company $10k. She is hoping MI company will take the $10k as a comprimise and my buyer ends up $9,000 in her favor. Anyone ever heard of anything like this?

Why didn't or wouldn't the bank work out the behind the scenes stuff with the insurance company?

[Toby Lane]

Randy, that is what I was wondering. I don't know enough about what all goes on behind the scenes to know if all of this is legit or not. I have put in several calls to people that will know, but haven't heard back yet. At first this sounded shady, but after it was explained, it all seems to make since.

[satxproperty]

Randy, that is what I was wondering. I don't know enough about what all goes on behind the scenes to know if all of this is legit or not. I have put in several calls to people that will know, but haven't heard back yet. At first this sounded shady, but after it was explained, it all seems to make since.

Be careful, I would think that most buyers would need the contracted sales price to include the insurance payoff... otherwise you won't get a loan for the sales price plus the $10,000.

But, why is the insurance company even involved, since the property is not yet foreclosed? But, then again, I don't know how all that works either.

[Toby Lane]

We'll definately put it in the contract and on the HUD or no deal.