We are super busy; the summer season is upon us.
Today we consulted with a Wachovia Bank Short Sale Manager and learned the following:
- A short sale will decrease your credit by 80 to 120 points, a foreclosure by 250-350 points
- It will save the bank $40,000-50,000 to sell a house with a short sale rather than taking it back in foreclosure so the bank does want to facilitate the deal
- Wachovia does NOT require the seller be behind in payments to qualify for a short sale (other banks do) but they do need a Hardship letter stating the seller has lower income, has lost a job or is going through divorce (the most common hardship cause)
- Wachovia will approve a short sale in 9-12 days and the deal can then move forward with a traditional closing of 30-45 days (this is extraordinary compared to other banks; fast!)
- The bank will pay back, unpaid taxes. It will pay HOA dues and assessments. It will not pay child support or other personal liens
- The bank will give the buyer a 3% credit for closing costs
- The bank has $121 billion portfolio of loans, half in California. 10,000-12,000 loans in Northern California are delinquent. Higher price points are showing up as short sales now.
- The seller will be given a 1099 for the amount their loan is forgiven and should speak to their CPA regarding repurcussions. A foreclosure also generates a 1099
- Most likely the bank will NOT come back to you for reimbursement for the shortage on the loan
We are marketing several short sales currently. Each situation is unique. Call us to run your circumtances by us. Wachovia took over World Savings and is now owned by Wells Fargo but its short sale department is separate from Wells. Wells also has a very well run short sale department.
A short sale is in many, many ways preferable to a foreclosure. We can help you preserve your credit; don't delay. Call us now!
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