http://tatute.com/?map10 Answers to the following Questions can be accessed by downloading a pdf file linked above:
Q1. What options does a lender have on a debt secured by California real property if the borrower does not make the payments on the loan?
Q2. What other options may the lender consider instead of foreclosure when the borrower is delinquent?
Q3. What is a deficiency judgement?
Q4. Under what circumstances is the lender prohibited from going after the “deficiency balance” as defined in Question 3 after a short sale?
Q5. Can a lender obtain a deficiency judgment against a defaulting borrower following a foreclosure?
Q6. Can a lender avoid the “foreclosure process” and just sue the borrower on the note (i.e., treat it as an unsecured note)?
Q7. Why would a lender agree to accept a short sale?
Q8. Is the seller in a short sale relieved of all debt obligations owed to the lender?
Q9. What language in the lenders “approval” letter lets the seller know that the seller in a short sale is relieved of any further debt obligations owed to the lender?
Q10. What language in the lender’s “approval” letter lets the seller know that the seller in a short sale is not relieved of any further debt obligations owed to the lender?
Q11. So what have lenders been doing if their “approval” letter does not relieve the seller of any further debt obligations?
Q12. Does a short sale adversely affect a defaulting borrower’s credit rating?
Q13. Suppose the borrower is late with his/her mortgage payments, causing the lender to begin the foreclosure process by filing a notice of default. Before the foreclosure sale occurs, the borrower pays the lender what is owed on the note. Could these activities appear on the borrowers credit report?
Q14 Is the method by which lenders report a short sale a negotiable item?
Q15. Are there any special risks to borrowers when negotiating a short sale with their lender?
Q16. Are there any tax effects of a short sale?
Q17. What is a short sale consultant?
Q18. Does a short sale consultant have to be a real estate licensee?
Q19. Can a licensed shore sale consultant collect an advance fee?
Q20. Must a real estate transfer disclosure statement be given to a buyer in a short sale transaction?
Q21. Must other disclosures be given to a buyer (or seller) pursuant to a short sale?
Q22. Suppose a distressed seller enters into a contract to sell his/her home to a buyer pursuit to a short sale. Should the listing agent inform the lender if and when offers are made on the property?
Q23. Should a listing agent working with a distressed seller attempt to negotiate a future listing agreement with the lender?
Q24. What is the process for applying for a short sale?
Q25. What documentation will a lender typically require?
Q26. Does C.A.R. (California Association of REALTORS) provide special forms for short sales?
Q27. Are certain lenders requiring the use of third party online auction services in short sales?
Q28. How does the bank utilize the services of the online auction provider in the short sale?
Q29. Does the use of online auction service affect the listing brokers commission?
Q30. Does the use of an online auction company affect the buyer’s agents commission?
Q31. Is using an online auction platform legal?
Q32. Why would an online auction platform require a license?
Q33. Since Auction.com generally does advertise and solicit buyers and sellers, should it be licensed?
Q34. Don’ online auction companies typically state they are not agents for the Seller?
Q35. When a short sale lender requires a seller to use a third party online auction platform doesn/t that interfere with the listing agent’s exclusive listing agreement?
Q36. Since the lender is interfering with the exclusive agreement that the seller signed with the listing agent, does the seller have a cause of action against the bank for requiring the seller to use a third party?
Q37. Are there causes of action that a listing agent may be able to pursue against a lender for interfering with the listing agreement?
Q38. What are the difficulties with pursuing the claims discussed in question 9?
Q39. What about the lenders who require the listing agent to do additional work (e.g., putting up signs or holding additional open houses)? Couldn’t that additional time count as damages?
Q40. There are reports of some banks effectively taking the listing away from the listing agent and insisting that the seller only use the online auction method. If this is true would that create a claim for damages?
Q41. Does the buyer’s agent have any claims against the short sale lender?
Q42. Does a listing agent have to agree to participate with the online auction platform?
Q43. Why are banks using this platform?
Q44. Is there a way to stop this practice?
Q45. Where can I obtain additional information?
check this out SOURCE: CALIFORNIA ASSOCIATION OF REALTORS® Member Legal Services 525 South Virgil Avenue Los Angeles, CA 90020 The information contained herein is believed accurate as of August 4, 2010. It is intended to provide general answers to general questions and is not intended as a substitute for individual legal advice. Advice in specific situations may differ depending upon a wide variety of factors. Therefore, readers with specific legal questions should seek the advice of an attorney. Revised by Sonia M. Younglove, Esq.