Legal Terms To Avoid Neg Effect On Credit
I read that there is special legal wording to include in the short sale package to prevent negative credit reporting that's more damaging to the homeowner. I also read that only a very few specialized real estate attorneys even know this language. Does anyone know the exact phasing one has to use or have had it done before by a knowledgable lawyer?
Thanks for any assistance.
Usually, the Proposal will 'request' that the mortgagee releases it's security interest for the amount offered as payment in full, and forgives the deficiency. The Proposal will request that the mortgage loan account be reported as, "paid as agreed".
Check the language in the mortgagee short sale terms for approval. It could be a boilerplate approval letter and disregard what had been requested.
That's when you use your black pen and make the agreement reflect what it should say. Have the seller sign, and initial any changes, then send it back.
They'll probably balk and this is where you must use your negotiating skills.
I say, "Leave good enough alone".
The owner's credit has been sooooo badly bruised that another ding don't mean a thing. The additional damage to the owner will be virtually undiscernible.
Just prepare him for this event. You would be better off doing the deal and then helping the owner via a credit repair program/regime.
Some of these lenders are so irrational ,that this attempt on your part to help the owner may scuttle the deal with the lender.