Short Sale Question
The house is in a great shape in with a first mortgage of $520K plus second mortgage of $55K. Homeowner needs about $55K to cure the default on 1st and 2nd. Besides, this he has unpaid credit card charges of about $15K. He has listed the house for $769K No offers yet. He claims he had an offer of $700K, which he feels he should have accepted.
He has lots of personal goodies (furniture, collectibles, etc.) in the house. I would like to approach the lender with a Short Sale offer. However, the owner wants a net amount of $35K. I know it is illegal for homeowner to make any money out of short sale. Is there any legal way of giving him $35K? Also, this house is one of the few big luxury houses in this neighborhood. Other house are of regular size going for average price of $300K. How much should I offer to the lenders?
"I know it is illegal for homeowner to make any money out of short sale. Is there any legal way of giving him $35K?"
It isn't illegal. It is, however, usually forbidden, and a condition of mortgagee short sale criteria. To circumvent this provision, you can purchase personal goods and/or services from the departing homeowner, for cash, and outside the scope of the HUD1.
Or, you can make a dedicated, tax deductible contribution to a non profit organization (there is one in Monmouth County) who in turn would assist you with the short sale, and make a gift to the departing Homeowner...