What will satisfy the lender in this case? - Posted by Gina B

Posted by Gina on September 30, 2003 at 14:36:31:

Thanks Ryan,

Seller is getting documentation in the mail. This is great.

More money down is no problem, I was going to put 20% down anyway.

Thanks again.

What will satisfy the lender in this case? - Posted by Gina B

Posted by Gina B on September 30, 2003 at 10:21:45:

Hi all,

This is my first deal, and so far so good, but I have a question that may sound naive but nonetheless, here it is:

I managed to negotiate down a mortgage on behalf of the owner who is ready to sell to me before the property gets foreclosed. There’s also a federal tax lien against the title, and once again, we got a break on the outstanding balance. Overall it’s a saving of $20k, and my offer to seller is total of new debt amount + $10k. The equity based on the new debt amount is $30K.

Yesterday I did an online search through the county recorders records and the NOD still shows up with the old balance, and the federal tax lien still shows up with the old balance.

What will my lender need in terms of proof for the discounts, because based on the old numbers my offer would be $10k short of paying off the outstanding debts making it unlikely to get financed as is. But the new numbers allow the debts to be paid off plus some extra cash in the seller’s pocket.


Re: What will satisfy the lender in this case? - Posted by Ryan

Posted by Ryan on September 30, 2003 at 13:41:43:


What you need from his mortgage company is a payoff statement. If you negotiated a short sale then you should have some sort of documentation showing they agree to release their lien if they recieve your agreed upon funding amount. You should also have his banks contact that you can give to your lender that can verify the payoff.
Again for the federal tax lein you should get a document signed by the department stating what the payoff amount is for the lein on the sellers propery. Most likely your bank will contact them to verify the payoff amount.
With these two statements your bank should begin working with you as long as you have the equity they want in the property after the short sale. They may still require money down.