Short Sale Back To Owners
If a person had a chapter 7 bankruptcy discharged and was attempting to buy their house back through a short sale from lender by using a non relative to purchase and then quit claim back to them in a land trust how could this be illegal if the debt. had been discharged since they are no longer responsible for the mortgage debt. anyone know for sure
WOW! that was tough to follow, I thought I was reading a Jerry Springer script lol
As long as the Chapter 7 has been discharged and the lender is not given false information, then it is legal to do just that.
But the current lender will have to release the property to the Land trust, they will more than likely not do this unless they are paid off ro an arrangement has been made.
To get a better perspective of this you may want to post the same question in the law and legal forum, to make sure you dont end up in the local pokey.
Good Luck,
Kyle
If the lender sells the house to a friend of yours, I would not worry about it. I would
do something more in the lines of a lease option from your friend to you or
you could have your friend buy the house
and put it into a trust that you control.
I have bought the same house three times before believe it or not. I bought
a house, retailed it to an end-user and a
year and a half later it went back to the bank. I saw it on the HUD list and bought it, rehabbed it, and resold it.
Two years later it was back on the HUD
list! Guess what I did? Bought it, fixed it
and sold it. Go figure!
Best Riches,
Jeffrey Adam
[addsig]
You don't say why you get the idea it's illegal. Sounds like an incompetent bank rep talking. In a short sale the lender is not the seller of the house. The owner is the seller of the house, the bank in this case would just be agreeing to take a short payoff. If they know that the person buying is going to deed back to their bad borrower then they may not want to agree to a short payoff, however it's not illegal. Simply do a sale to this buyer, get bank to agree to short payoff. Then after bank releases the mortgage, have this person deed back to original owner.
thank you all very much, this is a cash transaction from me to friend and then quit claim back to me in land trust, one attorney i talked to just stared at the ceiling for awhile and did not even know the answer , and one other reply on this question did say that this would constitute fraud but i do not see how since the debt. had already benn dismissed in court thanks guys
Wow, So many incompetent Professionals out there! (Attorney with his head up his butt)
You need to understand the way a mortgage works. The deed belongs to the homeowner and the bank only has a right to take it through foreclosure.
Yeah, the bank has a due on sale clause, but all they can do is say that the loan is due and payable. That is NOT a crime.
Just because the bank doesn't want the owner to have the house back once it has been defaulted doesn't make it a crime. The bank is smart, they just want someone who is going to pay.
And the whole deal with Land Trusts...too many VERY SMART PEOPLE don't understand these (ie. lawyers, RE agents, etc) not to mention us normal folk. However, these are awesome.
I suggest that everyone in this forum and any foreclosure forum to buy William Bronchick's Land Trust Manual.
I Paid $800 for All of his entity programs, but this one alone is $250. It is simple and completely informative. It walks you through every form necessary, every state's specific laws and requirements, and pretty much does it for you...just type in the names and record...simple.
Hope this helps.
[ Edited by sgtphilko on Date 03/11/2004 ][ Edited by sgtphilko on Date 03/11/2004 ]
you see most lawyers do not think outside the box because they dont learn about these types of situations in law school so when a question is posed to them their response is always the most the conservative one. In this case most attrorneys would not want to be involved in the transaction because of the liability part that someone may claim fraud later on and they and their insurance co. may be on the hook for it all over someone trying to avoid paying their bills.
If i'm doing a s/s on the first with the bank and the 2nd is behind in payments too.Do i try and get a S/s on the 2nd also.
If i'm doing a s/s on the first with the bank and the 2nd is behind in payments too.Do i try and get a S/s on the 2nd also.
yes you should they will probably take next to nothing ,cause being they will recieve nothing at the end