Posted by Natalie-VA on November 08, 2005 at 07:29:09:
Are you not in that area? If you are local, get down to your local banks.
If not, get some phone numbers of the local banks and go from there. You’re going to need a phone number for them to call you back.
Working over the internet got you into this hole. Get off the web and talk to some lenders in person.
default on note held by seller - Posted by Sushi Jackson
Posted by Sushi Jackson on November 04, 2005 at 12:00:35:
Need information desperately. My husband and I purchased a home 3 years ago and the seller agreed to hold 2 notes behind the lender. In short, we were unable to sell another home which we hoped to pay for the note… we called lenders to do a cash out refi to cover both notes held by the seller. The broker who promised he could meet the deadline of 29 Oct…didnt after many promises,The loan is still in underwritng…reaching agreement on appraised value etc…now the LTV has changed and therefore the rate will change and will have to resubmit a new application…My main question…we have defaulted on the note held by the seller of 250k approx. due oct 29…can he force a sale of the home eventhough he is second in line to the lender and more importantly, if he can force the sale, how much time do we have before the refi is approved to pay the note off. Our home appraised at 1.6 mil and the owner seems anxious to get it back as he has divorced since our purchase 3 yrs ago.
The penalty for missing the deadline is 5% and the second note of 150k(due in 18 months) now takes on a 9% annual rate rather than 0% due to missing the deadline on the 1st note.
Our plan now hopefully is to get our refi, pay off both notes with penalties of approx 400k before he takes action on forcing a sale of the home. We tried to negotiate through his lawyer one month prior to the deadline of the first note but the lawyer said he will deal with negotiations after a default on the note. We asked for additional time for a cash out refi. and stated we would pay both notes off …figuring a good deal for both parties considering the second note isnt due for another 18 months. We are cash poor and struggling to make payments each month but with the refi. we will have 100k after paying the notes to take the strain off the monthly mortgage payments.
Any and all advise would be greatly appreciated.
First Advice - Posted by Tom-FL
Posted by Tom-FL on November 04, 2005 at 20:30:30:
Here’s your first bit of advice. Tell the board what state you are in. All the info you gave is basically useless without knowing that.
Second advice. Any note in default can foreclose, regardless of position. First, second, fourteenth, it matters not.
Third, some states can take as little as a month from default to auction, others can drag on for years. Depends mainly on if it’s a power of sale state, or a judicial one.
Re: First Advice - Posted by Sushi Jackson
Posted by Sushi Jackson on November 08, 2005 at 04:25:32:
Thanks Tom, I assume Ma. has a 30 day limit? Can you offer advise on locating a lender to close in 2 1/2 wks before a forclosure. We have good credit (700) and 780 3 yrs ago at purchase.No late payments and little debt.The problem is a lender who can close in this time frame. We have been told by many brokers lenders yes on the loan but always 30-45 days. How can we locate a lender and not a broker to make sure it closes as the current broker has promised everything for 4 weeks. If MA, is 30 days after a default that gives us just 2 1/2 wks.Any help please!
Re: First Advice - Posted by Sushi Jackson
Posted by Sushi Jackson on November 05, 2005 at 03:53:36:
Thank you in advance for your advise and now brings the level of nervousness five steps higher. The property is located in Massachusetts. Since my initial posting a few more things have happened. 1) We received a certified letter today(Friday)to sign for and pick up at the post office (we are out of the area at the moment and a family member informed us). 2) After a rare converation with the broker yesterday, he told me the hold up was in the appraisal as the lender was disputing the accuracy of the appraised value…as it turns out he is working wih the same lender we currently have our loan(first note) with …this is shocking as I called my current lender prior to calling the broker one month ago…in short , our current lender informed me they couldnt close for 5 weeks and quoted a much higher rate than what the broker quoted us…the broker promised a much lower rate and a closing prior to the default date…
3) the broker who has had a month to close after promising 1-2 weeks told me yesterday the underwriters would reply and the appraisal issue would be resolved today(Fri) for sure(these repeated promises and no reply to calls or emails have continued for 3 wks) and promised to send the appraisal which we already paid for today and now he is not answering the phone.
From the sounds of it we better hope we can close with another lender in 3 wks. or face losing it all. Thanks so much for the information you have provided…would appreciate knowing what time frames Mass. has for forclosure on defaulted notes…Not adept at financing and realestate practices we have made obvious mistakes and are hoping to focus on the task at hand as the intent of the seller is now obvious. Thank you again for all the valuable advise. Note: a mistake in the first posting …the appraised value was 2.6 mil and the hopeful loan from the broker is 1.5 mil. thanks
Re: First Advice - Posted by Natalie-VA
Posted by Natalie-VA on November 06, 2005 at 10:15:47:
Sushi,
I can’t help you with your legal questions, but you should go to a local lender IMMEDIATELY. In cases like this, it’s very dangerous to work with a broker. As you can see, he’s been unreliable and you can’t even get him to communicate. He is the middle man and has little control over the loan. If you go to a local lender, you can sit down with them and talk face to face. You can visit them daily for status updates. Do it NOW. In the meantime, if the broker gets it closed, great, but don’t give him any money until it’s done.
–Natalie
Re: First Advice - Posted by Sushi Jackson
Posted by Sushi Jackson on November 08, 2005 at 03:53:29:
Thank you for your advise. I have looked under lenders in Mass. and most web sites are brokers in disguise… and say they are lenders and brokers depending…then go on to say they work with lenders…also, very few are from Mass. Also, it is difficult get in contact with them as they have voice mail and want a no. to call back. …any additional insight would be appreciated as time is running short. Thanks
Re: First Advice - Posted by Sushi Jackson
Posted by Sushi Jackson on November 07, 2005 at 02:21:40:
Thanks… I will heed your advise and start today.Any lenders who can get this deal done in 2 1/2 weeks…that you know of. I did talk to a lender on Fri. and explained the time frames…the rates were one full percent higher and closing costs close to double…rates must meet the demand I guess. Thanks for the feedback