what is the homebuying process.

[sppunk]

Also maybe there is a difference in loan types, hence this little disagreement. Each bank too will have policies it must adhere to. I work most closely with SunTrust, PNC and more with their legal firm buddies like Ballard Spahr, etc.

[Bread Regal]

Originally Posted by Bread Regal

so does that mean this devolves into an auction type situation?

.

[The Omega Concern]

Originally Posted by duovamp

No way can or does the bank write off 180k in bad loans.

QE

[sppunk]

Originally Posted by duovamp

Yeah what do I know it's just my job. Thanks for the wiki copy/pasta. I guess my NMLS ID doesn't mean anything.

Also you proved yourself wrong - the "agreement doesn't release borrowers from their obligation." It doesn't matter what the circumstance is, the bank will get paid. That's why you sign fifty pages of documents at loan closings on mortgages - to protect the bank from ever losing a dime. They probably transferred the note to a new piece of property.

What happened is the bank didn't walk away from 180k. They never would. It's not unsecured debt. That seller would've had to declare bankruptcy. And even then, when you go bankrupt, the banks still follow you to your grave.

There's even insurance to make sure that stuff doesn't happen.

Mine too, for the government!

The bank gets paid as much as it can from the seller, it can garnish wages or wipe a bank account. But banks are legally seeing opposition on this.

I'd stay far from a short sell. Foreclosure properties too,but that's a different gig altogether.

[duovamp]

I can definitely agree that you should avoid a short sell for a number of reasons.


But any bank that "agrees" to forgive a massive amount of debt would be in tremendous legal trouble, let alone tremendous financial trouble. That's the kind of thing that gets auditors to shut your bank down.

A scenario would be the bank's CEO's brother buys a piece of property. Gets a loan for 500k. House is worth 300k. Sells house.

1. Where was the title insurance here?
2. Was the property's appraiser a third party?
3. How does the LTV get that far out of hand? Is this a normal lending practice outlined in this lender's credit policy? Our bank's max is 80%, for example, as a pretty conservative and small bank.


Sounds to me like there may have been multiple liens from different lenders, none of whom did any kind of title search...

[sppunk]

If the bank can resell for the value it generally has met legal obligations iirc.

I'm not sure if auction is the right term. The process is usually drawn out - I'm not sure the percent of successful short sales either.

[Eulogy]

Fwiw I think Sppunk is right on his point of disagreement with duo. But I have a tenuous grasp of this shit at best.

Once again

Rent 4 life.

[Eulogy]

Banks will forgive a certain amount because otherwise they'd get nothing. ...right? My impression is that it needs to be relatively close to what is owed though.

[Eulogy]

Originally Posted by Bread Regal

it was last sold in october 2005 as the bubble was just approaching its maximum. seems fucked that banks "as a favor" will forgive the shortfall on your debt with them, if you agree to sell the house to someone else at its actual, non-inflated value.

I mean. They loaned the amount of the value at the time of the purchase. From a purely technical standpoint it makes perfect sense to get paid back the amount you loaned plus interest.

Which is why

Rent 4 life

[sppunk]

Renting is fine in many markets but in the majority I'd wager it is truly a money pit. But that's just the financial state, many don't want the headaches that come with owning which is understandable.

[Eulogy]

Well I mean. I'm paying for a place to stay. I don't see the housing market growing forever with no more bursts. Too unpredictable and potentially crippling.

[Eulogy]

But to be fair rent in Chicago is wonderfully cheap. For a large city, anyway.

[duovamp]

They ain't makin' any more land.

[sppunk]

Originally Posted by duovamp

They ain't makin' any more land.

Buy air space!