How Can I Avoid Foreclosure And Prevent Deficiency Judgements?

Heath Montgomery is the Reno – Sparks area’s #1 Short Sale Professional.  His success rate for Short Sales is one of the highest of any Realtor or real estate agent in the area.  In this Frequently Asked Questions format Video Blog – Heath answers all of your Short Sale related questions.  Be sure to visit the Short Sale FAQ page to have all of your top Short Sale Questions answered.

If you’d like to speak with Heath today and discuss how a Short Sale may benefit you, please click the “Get Started with Your Short Sale Today” link located below.  Or, feel free to email Heath Montgomery directly:  heathm@kw.com

 

Deficiency Judgements

When completing a Short Sale on your home, your bank(s) or lien holder(s) will of course ultimately issue a Short Sale Approval Letter.  In my opinion, this is the most crucial time in your Short Sale transaction.  The fact that you’ve received an approval is fine & great – but we need to make sure this bank will not be calling you in the future!

When we receive the Short Sale Approval Letter we want it to include verbiage specifically stating that they:  “Waive the right to pursue a Deficiency Judgment in the future.” For instance, if you owed $200,000 on your original mortgage – and your home ultimately sold for $100,000 – the difference would be ‘more or less’ $100,000.  We want your bank to agree in writing that they will NOT be calling you a month or two from now saying, “Hey Mr. Homeowner!  Remember that Short Sale you completed?  Well, we’d like to talk to you about that $100,000 difference!”

At the Reno Short Sale Team, we have help our short sale clients to receive approval letters with deficiency waivers.  In order to receive a non-deficiency short sale approval letter, it requires your listing Realtor or real estate agent to use sharp negotiating skills.  Recently, we have been asked if it is necessary to have an attorney complete the short sale in order to avoid a deficiency judgement.  It is absolutely NOT necessary to have an attorney complete your short sale in order to negotiate a non-deficiency short sale.  If you would like to see what a non-deficiency approval letter from your bank looks like, please email us here and and mention your bank’s name.

 

Do I Qualify For A Short Sale?

 

It’s also important to note that on a rare occasion, not all banks will have the ability to issue release of Deficiency Judgment.  In fact, it’s not the bank that determines whether or not they’ll forgive the difference – it’s actually the investor behind the loan.  Many investors will release judgment if you simply ask, “Will you please send me a release of Deficiency Judgment?”  Done.  Other investors do not issue them – period.  So it really depends on who the actual investor is on your loan.

Some of the banks that have been easier to receive deficiency free approval letters as of lately include: Bank Of America, Chase, Wells Fargo, Indymac, Citimortgage, and GMAC.  Please read some short sale reviews from our valued Reno short sale clients.