Tuesday, May 29, 2007

short sale and arms length notice

I just examined title for a cash transaction - $38000.00 - on a fast track to close before month end.

Title indicates the buyer is the brother of the seller. He sold her the property in 2000 for $43000.00. Sister is now in foreclosure and the lender is seeking close to $40000.00 to cover costs and interest.

At face value, I would say these folks are likely negotiating with the lender for a short sale.

I'm okay with that so long as the lender acknowledges that they are aware that the purchaser sold the property to the current owner for $43000.00 and that he is her brother.

With that info in hand, I am totally okay if lender wishes to avoid additional expense and sell the property now.

Why do I care? Well, these folks are asking the lender to take a $2000+ hit. It's entirely possible that the property may be worth more if it was offered for sale on the open market to parties who have no vested interest. My job is to give the lender the facts. They make the decision.

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