Short Sale - clouded deed...can this work? - Posted by Stretch361-MI

Posted by Carmen_FL on July 15, 2004 at 17:47:12:

Aaahhh … have warning bells gone off in your head yet?

A “seller” who is neither on the deed nor the mortgage is not a seller. Who the heck knows how he came into posession of the property, or if he did at all?

The “catch” here is that the person who is actually on the deed will need to sign the property over if you do buy it on a short sale, and the person who is actually on the mortgage will need to give you authorization to ask for a short sale. Are these the same person, or two different people? Will they cooperate? Is the person on the deed the real estate agent “friend”?

If you can’t get the person on the mortgage to agree to a short sale, but are able to get the person on the deed to sign it over, you could try to buy the note instead. The guy on the mortgage should still be happy because he would no longer be in foreclosure (unless you chose to pursue it). That’s if you have the cash and weren’t borrowing from a bank.

Or, you can buy the note and foreclose if the person on the deed does not cooperate, but that’s a whole different ball of wax.

BTW, when you’re this close to foreclosure, in my opinion, it’s pointless to worry about the Due on Sale Clause. What’s the bank going to say? “I’m foreclosing on you … but WAIT! You signed the property over! So forget it! I’ll just make you pay me the full amount! Hahahah! Oh, you can’t pay me off? So now I’ll foreclose on you twice!” Banks seldom seem to check the title on the property - they care about getting paid. I have most of my properties in Trust, even before I do my short sales, and have never had a bank ask to see the deed prior to approving the short sale.

Short Sale - clouded deed…can this work? - Posted by Stretch361-MI

Posted by Stretch361-MI on July 14, 2004 at 08:30:36:

Here’s the situation:
I got contacted by a “seller” trying to sell his house because it is in forclosure. He wants to sell it for the amount owed, plus the back payments…Here’s the catch…The deed on the public records is in someone else’s name and the mortgage is in someone else’s name. I spoke to this “seller” about this, and he said “The owner let me take over his payments, and he hasnt made the payments. I quit-claimed the property in my name, and it’s held in escrow with my real estate agent friend”. Now, there is some work that would need to be done to this property, which would make this a perfect opportunity to offer a short sale package to the bank. Question I have is, how should I approach this so that the deed isn’t “clouded”, and ensure the bank doesn’t find out about this “clouded” title to try and force the DOS and not Short Sale it…Any suggestions?

trish stratus - Posted by trish stratus

Posted by trish stratus on October 18, 2005 at 17:35:17:

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