my ds and dil are in an upside-down loan. dil purchased before she met ds. with ds and now 2 dkids, they've out-grown the house..
so they wanted to do a short sale and move on using ds as primary buyer...he qualified but now they're(realtor and bank) saying pay current mortgage til they find a new home then litterly move out, and leave the house...
it sounds so bougus to me...
Posts: 8149 | Location: se mi | Registered: Sep 25, 2002
SJF please advice your ds and dd that they need to go talk to another lender and lay all their cards on the table. The current rules for home loans include 1) Husband nor wife can have a foreclosure in the past 7 years 2) Husband nor wife can have a short sale in the past 3 years and it does not matter if only one of them was on the loan. So, in order to buy a larger house they have to qualify with both mortgages...are they able to do that? If so they should be considering renting the present one out (JMHO.
I also have doubts as to the either the agents qualifications or ethics....take your pick.
I also agree with mamaspoon...and the underwriter may very well see it the same way. One of the things that can happen is the underwriter can call the loan due immediately...and we just recently had that happen.
THAT advice your kids are receiving leaves the kids out to dry with no solution except to face a judgement for the difference between what is owed and what the house sells for. PLUS their home to be ripped to shreds by vandals and possible neighbors on the take...which would increaase the judgement amount.
Honor the committment, create a good destiny, and stay put until the market recovers.This message has been edited. Last edited by: real estate lady,
Originally posted by real estate lady: Honor the commitment, create a good destiny, and stay put until the market recovers.
If the kids move forward with this bone-head scheme, the best thing you can do is to preserve your relationship with them by keeping your lips zipped. It's gonna be hard, but they're adults (sort of) and have the privilege of making their own mistakes regardless if they ought to win the "Morons of the Year" award. If you speak up, who knows how they'll hold it against you.
The best thing you can do for THEM is to keep your pocketbook zipped also, 'cause when the brown stuff hits the fan, their next move will be to come to you asking for money to bail them out. If you give/loan them the money, you'll not only be enabling them to make more poor financial decisions in the future but you'll never see that money again.
Best wishes to you -- I'd want to strangle my DS if he conducted his financial affairs this way.
Wow, slf, so many things wrong here that I don't even know where to start! First of all, if a "banker" was involved in this so-called scheme, I sure would not be doing business with that bank.
I think it all came about because only dil was on the mortgage and, supposedly, ds qualified for a loan on his own. When push comes to shove, if they are married, dil's "walk-away" or whatever you want to call it WILL impact ds's ability to get approval - Lakelark is right on point about that.
Bottom line, anyone (real estate agent or so-called banker) who advises someone to engage in fraud is NOT your friend. Tell ds and dil to find another real estate agent and another means of financing. The ones they are talking to right now are NOT their friends - they just want to make a sale, a commission or whatever and will be gone with things get serious....
Their agent and lender could both lose their license if what the OP says is what they actually recommended.
It is possible for the OP's son to qualify for a loan and for them to do a short sale. They need to discuss the short sale option with a qualified lender and a real estate agent experienced in short sales.
Let me guess, the "bank" referred to in the original post is not the bank holding the current mortgage but rather a mortgage broker looking to do a deal for the new house. It seems like they, as well as the agent are looking out only for their commissions. Whatever "bank" or mortgage broker or realtor urging this course of action should be run away from without looking back and probably reported to the appropriate state licensing agencies.
sjf - have they done anything on this? Very sad that people are giving advice like this (telling people what they want to hear.... - sure you can get a bigger house and just leave the house you're in.....).
Deb and rker - I think there is more to it than was reported back to SJF.
In most if not all state the lenders are licensed as well as the real estate agents. If this was the actual exchange then both could be in jeopardy of losing their licenses and could be charged with fed and state crimes. These are not something that either would consider suggesting possible fraud to the home owner.
Yep. money rules, but we are seeing more and more lenders and real estate agents in court for illegal practices.
Charming, I think you're right - it just sounded crazy, and one sale wouldn't really be worth losing your license for.... but some people are pretty crazy.... Just wanted to know if OP had an update, or if kids got it worked out CORRECTLY........
SJF after thinking about what you are saying I think I understand. They are leaving the dil off the new mortgage and she will waive her dower rights and not be on title. Your son is not on the present mortgage and earns enough to qualify for the new mortgage. So, they will purchase the bigger home and then walk away from the one dil bought therefore the underwriter is unaware of the fact that there is going to be a foreclosure in the picture. By making the payments they keep their credit scores high enough to qualify for the new mortgage.
My suggestion is they need to talk to an attorney who specializes in financial planning. They are not looking at the possible repercussions to dil should something happen to your son.
They may be able to pull it off with no penalties other than a hit to her credit...
It will be another foreclosure to hurt the value of the homes around them, so I hope they don't have any family or friends in the neighborhood.