Mortgage Fraud -Think and use these words carefully if you are a short sale seller! I say this because I have seller's calling me from all walks of life...from different states...with different situations..short sale situations and some sellers choose the words mortgage fraud!
When I hear mortgage fraud...I ask immediately...have you called an attorney? In most instances..a REALTOR is the first person they call..and in some instances its just been me!
Be very careful using the term mortgage fraud..you may in fact implicate yourself! Seek the advice of an attorney..especially if you have..a stated income loan...or You know the 1003 application...has false information..after all you signed the darn thing and that signature might be enough to implicate yourself.
Ask thought provoking questions..you'll get the answers...and most of all listen..and the next time you speak to a short sale seller let them know..their very own actions might in fact implicate them. Remind them you are not an attorney..and that they should in fact..seek the advice of an attorney!
16 Comments on Shortsale Sellers-Mortgage Fraud-Use Those Words Carefully!
Midori, this is one of the best posts I have seen on the topic of short sales. I see people rushing into short sales very often without pausing to consider the consequences. Mortgage fraud allegartions can be a real concern, along with Federal and State tax implications on the payoff shortage, and the possibility of remaining personal liability on the shortage.
Sometimes getting a short sale done is not a service to the seller.
So many people are claiming they did not know what they were signing. It was all fine when they bought the house and lived in it for two years. Then realized they truly could not afford it. Shame on them too
James-well I am not an attorney and would not practice law without a license...as a REALTOR my best advice is to seek an advice of an attorney when I hear the words mortgage fraud! So many times we get caught up in obtaining the listing or trying to really help a seller...as much advice as I give...I do not give legal advice!
There are many things to consider when doing a short sale..not just from where I am standing...but the seller and the law!
Good points; there are so many nuances that must be considered and sometimes it is better to ask lots of questions before giving any advice, and then, give only real estate advice, not legal.
Russ-I did mortgages and sold real estate. I am no loan officer..another words..hated it!!!!! That is me..I found that people just don't read the fine print...they want credit...and I know I have been guilty myself...I tend to trust the person I am talking to.
To me it's a two way street...how many times does an agent really go over the entire sales contract? Or how many buyer's do not even sign the good faith estimate but put it back into the envelope..and tuck it in a drawer...
I guess if we were truly consultants...truly providing a service..we would stress people to read the fine print..I know one of the things I tell people...I am not making your mortgage payment...can you live with it...meaning...can you have a quality of life...that a mortgage isn't going to choke you. I encourage people to read the fine print...I see it with REALTORS when I train..skimming...and not reading then coming back to me months later...why didn't this work? why does this cost so much? I could go on and on.
I think people in desperate situations..either avoid...try to find a solution...or pass the buck! I truly want to warn sellers to be very careful!
Sheila-yes many nuances..to consider..if you listen...sometimes...the seller figures it out...if you ask the right questions...the seller figures it out...A couple called me yesterday...I asked one simple question..did you sign your loan application..the answer..yes. Did you review your good faith estimate? The answer again...yes...
Call an attorney..and figure out..if you can live with what he says...I am no lawyer but I do care about people..please call a lawyer..and then make decision after talking to them! And if you found what I said useful...call me back..I'll find the perfect short sale expert in your area!
This morning..I woke to a very warm email...you are right..we should have called an attorney first! BTW we will take you up on your offer if we should need the services of REALTOR!
Midori~Great information and much needed these days! It seems as though the Sellers I've been hearing from lately think that the short-sale process is a simple one and that they can just ask the bank to take less than what's owed and not be responsible in any way for a shortage themselves. I think that more and more Sellers are going to have rude awakenings over the course of these next few years as lenders are starting to push back more now and hold Sellers accountable for what they signed.
LaShawn-I can tell the modifications of loans are happening in our area...so I think sellers should really think about all the choices. Make good sound decisions and not only think about today but also down the road. I believe credit will become very hard to obtain.
I did see an instance where the buyers were challenged with their English. When I reviewed documents from their purchase, it was suspicious at best. Fortunately I was able to assist them without needing a short sale.
Legally we are not to give advice, only opinion that is with in our professional expertise on how to market and offer for sale a home, negotiate a contract, manage contingencies etc etc etc. Most of my Short Sale Clients have been referred to me by an Attorney, its really nice when they start there, then call.
Midori Miller-Daytona Beach Florida Real Estate Trainer
Midori, this is one of the best posts I have seen on the topic of short sales. I see people rushing into short sales very often without pausing to consider the consequences. Mortgage fraud allegartions can be a real concern, along with Federal and State tax implications on the payoff shortage, and the possibility of remaining personal liability on the shortage.
Sometimes getting a short sale done is not a service to the seller.