The Otherside Of A Short Sale
Maybe my perspective can help educate some. And maybe some of you can help educate me. I had a rental property in Utah that I was losing money on. I made a lot of money at the time so floating the loss was simple enough. Ultimately, I had to sell it or I would go bankrupt. I never missed a payment and my credit was perfect.
At this point I would have loved to have met any one of you guys looking for a SS candidate, but instead it took me 2 years to find a buyer! (didn't know you were here). Once I had my buyer, I was able to convince the bank that if "we" didn't find a way to take this buyer's offer of a short sale, they would end up foreclosing on the property soon enough. They agreed to a SS of $111k on $135K loan balance. Keep in mind that I provided them with a hell of a lot of research on the area that painted a nice picture of a downwardly spiraling real estate market.
So, in the nick of time, the bank and I sold the property to our lovely SS buyer, and "we" made a claim against the PMI company for the diference. Interestingly I did not recieve a 1099 from the mortgagee at the end of the year. I did however receive a promisory note from the PMI company for the amount they had to cover.
My question to all is this, how am I liable to the PMI company for 100% of their covered loss when I paid them monthly premiums for 5 years to insure against this very possibility?
Too bad we didn't meet when we could have hleped each other out.
I guess you mean that the PMI Company required that you agree to a promissory note at closing to repay the amount that they had to pay out to their Client, the lender.
Q. Did your credit remain good?