house

[StEt0417]

We filed Ch. 7 , already had our 341 meeting now just waiting on the discharge papers. Our attorney told us we could short sale our house. We the house was included in the ch.7/ I was confused on that because I though the bk took care of that. I called a couple of real estate agents asking them about the short sale and they couldnt understand why I would want to do that since the bk pretty much discharges that.
For my understanding from the attorney it discharges you from the debt. Is this something I should look into further or just leave alone. We no longer live in the house and moved out of state.

[NoMoreCards]

There is no benefit to short sale for you. Trust your attorney.

[tobee43]

we did the same thing. if the house mortgage was included in the bk and it was discharged then you are no longer responsible to do anything. the bank will eventually foreclose on the house if you surrendered it.

don't let anyone tell you are responsible to participate in a short sale, or any other type of sale for that matter. by the way the bank that owns our old house still hasn't foreclosed and it's been just about 4 years.

[Miknan]

Wouldn't a short sale be a good idea to get it out of your name if you aren't living there anymore? Plus, the way I understand it, you can't get another mortgage for three years after the foreclosure/short sale so if you aren't living there the sooner you are off the note the better.

[tobee43]

i realize that many people are saying how important it is to get your names off the deed. frankly, i don't think it means a thing. after all, in the state our property was in the bank has a statue of limitations of 20 years!! that's TWENTY years to transfer the deed, or...maybe never, can you believe.

if the bank was to do a short sale, (of course they have to approve it anyway) that's up to them. first of all, one can't do a short sale anyway, unless it's bank approved. but personally for me, that is, and of course this is just me, it's now the banks problem, not mine, so let them do whatever it is that want.

flip the coin over for a sec, for some if they feel they have a buyer interested in a short sale, then i would contact the short sale dept of the bank have the Realtor work directly with them and give it shot, if, in fact it's that important to someone to get their name off the deed.

i have heard over and over on this forum about the legal responsibilities of those who's name are on the deeds, however, have never heard, seen, or smelt anyone being responsible for any part of expenses one way or another at any time ever since this surge of foreclosures and bankruptcies came into light in this country after surrendering or foreclosing on a property. (although i have heard a few deficiencies stories in reference to banks attempting to collect, which i know were not true because of the mortgage debt relief act, is and has been in effect for the pass few years and remember the act ends in 2012!)

as far as getting another mortgage, you may be correct, although i know of NO ONE that got refused a mortgage because there name was still on a deed somewhere. i hear it all the time, you can't get one until this or that, but really who has experienced this???? do you know anyone that in fact, was refused a new mortgage because of that sole reason? a bk yes, i can see that, but this thing about having your name off a deed. i know, i know, many may think me crazy...i am a bit i guess. but i just want to see it with my own eyes.

[despritfreya]

IMHO the only one who benefits from the short sale, assuming it actually closes, is the realtor.

Des.

[btbeme]

Here are my thoughts, for what they are worth...

We stopped paying our mortgage just after the 341 hearing. It took the bank almost 16 months to start foreclosure, whereupon we started a short sale process. Why? Well, we were still living there and wanted to live rent-free for as long as possible. That was our primary reason, at first.

Then, we discovered that the Federal government will pay short sellers about $3000 via the HAFA program to aid in moving and relocation expenses upon the completion of a short sale. OK, so we could live for free a few more months, then collect a $3000 check? Sold!

And then...we discovered that our type of loan (Option ARM originated through Washington Mutual and taken over by Chase) would actually qualify for a program that Chase sponsored. That program, upon completion of short sale, paid out a maximum of $20,000. We could hardly believe it...live free, then get a check for $20 thou? Yup, true - the short sale is closing before Jan 12th, and the check is waiting for us.

So...one motivation to short sale is the financials of living free (though this is of no benefit to the OP since they are long gone), and the possibility of a Federal reimbursement (most BK filers would certainly qualify for HAFA). It is also not entirely uncommon for investment groups to purchase short sale homes and allow a rent-back or a nice check for the occupants to leave quietly.

Also...at least here in Arizona, we are still obligated to provide insurance coverage for the property until it is out of our name. Seeing as how foreclosure can take eons, we didn't want that liability.

Now, that being said, I feel that someone trying to make a decision get the best guarantees of some sort of fiscal gain, because the process of doing short sale paperwork is a royal pain in the butt. Unless you KNOW you are gonna get something out of it (like a check for $20k), I'd skip it.

Just my opinion.

[NJLawyer]

That's interesting about the $20,000 payment. I've never come across it. I searched some of the Chase/WAMU pages for something about that and found nothing about it. Could you post something more specific?

Thanks

[despritfreya]

And then...we discovered that our type of loan (Option ARM originated through Washington Mutual and taken over by Chase) would actually qualify for a program that Chase sponsored. That program, upon completion of short sale, paid out a maximum of $20,000. We could hardly believe it...live free, then get a check for $20 thou? Yup, true - the short sale is closing before Jan 12th, and the check is waiting for us.

That's cool. Never heard of it but hats off to you if you actually get $20k. Just remember to set aside 22% for taxes on the income.

Also...at least here in Arizona, we are still obligated to provide insurance coverage for the property until it is out of our name. Seeing as how foreclosure can take eons, we didn't want that liability.

Need to correct the above. No such requirement in AZ. Only requirement is to service the HOA after bk filing until foreclosure - or face collection action. The lender will put insurance on the property but that insurance will only protect it from damange to the home. Does not protect the titled owner from someone getting injured or a loss of personal property. If the titled owner wants such protection then the titled owner needs to secure proper insurance but there is no "requirement" to do so.

Des.

[adams8866]

And the bank.

[tobee43]

That's interesting about the $20,000 payment. I've never come across it. I searched some of the Chase/WAMU pages for something about that and found nothing about it. Could you post something more specific?

Thanks

it certainly is, we had/have chase and our experience with them was not even close.

however, we had an FHA with PMI and chase must go through proper channels or procedure to collection on the government back loans and they haven't done even the first step. i have never heard of the program that btbeme is lucky enough to be part of.

also perhaps the difference for us, was we left the premises and didn't stay and not pay, thereby not giving the bank any incentive to get us out. you know in nj it gets extremely cold in them there hills (we heard just yesterday where we had/have the property was -14 degrees wind chill), just what it costs us in heat and electric pays every last expense we have here in florida, so for us it was a no brainer...get out NJ (after 33 years).

des: yes, i agree, the only one that benefits is the bank, so why bother. that is unless you come across a nice sweet deal as btbeme.

[tobee43]

oh, and just one last comment about retaining insurance on one's house while in foreclosure.


i can understand if one is still residing in a house, you do want to protect your contents and your personal property. however, if you vacate you are under no obligation to maintain the insurance..actually chase immediately covers the premises under their umbrella policy. but i'm hard pressed to believe it's a "law" that one is obligated to maintain homeowners. again i'm not from the show me state, but i need to see that written somewhere because people will have you believing everything....sometime way too much incorrect information being circulated, confusing and crazy!

also in new jersey, the insurance companies will no longer issue a policy if you are not residing in the house. (we tried since at the time we thought we were still responsible in some way), and actually it was the homeowners insurance company that educated us clearly on the situation. i don't know how it would have worked had be stayed.

[Freddy03]

Here are my thoughts, for what they are worth...

We stopped paying our mortgage just after the 341 hearing. It took the bank almost 16 months to start foreclosure, whereupon we started a short sale process. Why? Well, we were still living there and wanted to live rent-free for as long as possible. That was our primary reason, at first.

Then, we discovered that the Federal government will pay short sellers about $3000 via the HAFA program to aid in moving and relocation expenses upon the completion of a short sale. OK, so we could live for free a few more months, then collect a $3000 check? Sold!

And then...we discovered that our type of loan (Option ARM originated through Washington Mutual and taken over by Chase) would actually qualify for a program that Chase sponsored. That program, upon completion of short sale, paid out a maximum of $20,000. We could hardly believe it...live free, then get a check for $20 thou? Yup, true - the short sale is closing before Jan 12th, and the check is waiting for us.

So...one motivation to short sale is the financials of living free (though this is of no benefit to the OP since they are long gone), and the possibility of a Federal reimbursement (most BK filers would certainly qualify for HAFA). It is also not entirely uncommon for investment groups to purchase short sale homes and allow a rent-back or a nice check for the occupants to leave quietly.

Also...at least here in Arizona, we are still obligated to provide insurance coverage for the property until it is out of our name. Seeing as how foreclosure can take eons, we didn't want that liability.

Now, that being said, I feel that someone trying to make a decision get the best guarantees of some sort of fiscal gain, because the process of doing short sale paperwork is a royal pain in the butt. Unless you KNOW you are gonna get something out of it (like a check for $20k), I'd skip it.

Just my opinion.

Does a short sale have the same 3 year timeline to purchase a new home like a foreclosure??

$20K is great! I've looked into something similar with Wells Fargo and lucky me they don't offer anything over $3500...

[tobee43]

Does a short sale have the same 3 year timeline to purchase a new home like a foreclosure??

$20K is great! I've looked into something similar with Wells Fargo and lucky me they don't offer anything over $3500...

freddy, if you go on the premise or rumor mill of the 3 year time period that one's name must be off a deed before you qualify for a mortgage, i don't believe it much matters how one transfers the name from the deed. whether it's a short sale, long sale, or medium sale the purpose is once the house is sold under whatever circumstance is when the deed transfer occurs, and the old owners name is removed and the new owners name is put on. that can even happen when the bank buys it back and puts there own name on it.

yeah, good luck with wf!!

[Freddy03]

freddy, if you go on the premise or rumor mill of the 3 year time period that one's name must be off a deed before you qualify for a mortgage, i don't believe it much matters how one transfers the name from the deed. whether it's a short sale, long sale, or medium sale the purpose is once the house is sold under whatever circumstance is when the deed transfer occurs, and the old owners name is removed and the new owners name is put on. that can even happen when the bank buys it back and puts there own name on it.

yeah, good luck with wf!!

Oh got it. Thanks!