Tuesday, September 18, 2007

query: if lender approves short sale can they retain lien

Every short sale agreement I have seen includes satisfaction of the underlying mortgage lien if funds are received by the lender within the terms of the short sale agreement.

It is extremely important to read the short sale agreement carefully. I also recommend that you have the actual closing/escrow company prepare the draft HUD-1 on which the agreement will be negotiated. This way you'll have credible figures in play rather than rough figures that may be used by the real estate broker.

Bear in mind that even in a short sale situation you may be obligated to repay the shortage to the lender as a personal obligation after the closing. Discuss the pros and cons with your attorney.

No comments: