{"id":2398,"date":"2014-10-24T21:25:57","date_gmt":"2014-10-24T21:25:57","guid":{"rendered":"https:\/\/exclusive-realestate.net\/?page_id=2398"},"modified":"2014-10-24T22:11:48","modified_gmt":"2014-10-24T22:11:48","slug":"short-sales-what-is-a-short-sale","status":"publish","type":"page","link":"https:\/\/exclusive-realestate.net\/?page_id=2398","title":{"rendered":"Short Sales | What is a Short Sale?"},"content":{"rendered":"<!-- Place this tag where you want the +1 button to render. -->\n\t\t\t\t\t\t<div class=\"g-plusone\" data-size=\"standard\" data-annotation=\"inline\" data-width=\"120\"><\/div>\n\t\t\t\t\n\t\t\t\t\t\t<!-- Place this tag after the last +1 button tag. -->\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t<script type=\"text\/javascript\">\n\t\t\t\t\t\twindow.___gcfg = {lang: 'en'};\n\t\t\t\t\t  \t(function() {\n\t\t\t\t\t\t\tvar po = document.createElement('script'); po.type = 'text\/javascript'; po.async = true;\n\t\t\t\t\t\t\tpo.src = 'https:\/\/apis.google.com\/js\/platform.js';\n\t\t\t\t\t\t\tvar s = document.getElementsByTagName('script')[0]; s.parentNode.insertBefore(po, s);\n\t\t\t\t\t  \t})();\n\t\t\t\t\t\t<\/script><br\/><p><a title=\"Short Sales\" href=\"https:\/\/exclusive-realestate.net\/wp-content\/uploads\/2014\/10\/Short-Sales.pdf\" target=\"_blank\">Short Sales<\/a><\/p>\n<p>Answers to the following Questions can be accessed by downloading a pdf file linked above:<\/p>\n<p><span style=\"color: #000000;\">Q1. \u00a0What options does a lender have on a debt secured by California real property if the borrower does not make the payments on the loan?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q2. What other options may the lender consider instead of foreclosure when the borrower is delinquent?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q3. What is a deficiency judgement?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q4. Under what circumstances is the lender prohibited from going after the &#8220;deficiency balance&#8221; as defined in Question 3 after a short sale?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q5. Can a lender obtain a deficiency judgment against a defaulting borrower following a foreclosure?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q6. Can a lender avoid the &#8220;foreclosure process&#8221; and just sue the borrower on the note (i.e., treat it as an unsecured note)?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q7. Why would a lender agree to accept a short sale?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q8. Is the seller in a short sale relieved of all debt obligations owed to the lender?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q9. What language in the lenders &#8220;approval&#8221; letter lets the seller know that the seller in a short sale is relieved of any further debt obligations owed to the lender?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q10. What language in the lender&#8217;s &#8220;approval&#8221; letter lets the seller know that the seller in a short sale is <span style=\"text-decoration: underline;\">not<\/span> relieved of any further debt obligations owed to the lender?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q11. So what have lenders been doing if their &#8220;approval&#8221; letter does not relieve the seller of any further debt obligations?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q12. Does a short sale adversely affect a defaulting borrower&#8217;s credit rating?<\/span><\/p>\n<p><span style=\"color: #000000;\">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. \u00a0Before the foreclosure sale occurs, the borrower pays the lender what is owed on the note. \u00a0Could these activities appear on the borrowers credit report?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q14 Is the method by which lenders report a short sale a negotiable item?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q15. Are there any special risks to borrowers when negotiating a short sale with their lender?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q16. Are there any tax effects of a short sale?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q17. What is a short sale consultant?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q18. Does a short sale consultant have to be a real estate licensee?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q19. Can a licensed shore sale consultant collect an advance fee?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q20. Must a real estate transfer disclosure statement be given to a buyer in a short sale transaction?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q21. Must other disclosures be given to a buyer (or seller) pursuant to a short sale?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q22. Suppose a distressed seller enters into a contract to sell his\/her home to a buyer pursuit to a short sale. \u00a0Should the listing agent inform the lender if and when offers are made on the property?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q23. Should a listing agent working with a distressed seller attempt to negotiate a future listing agreement with the lender?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q24. What is the process for applying for a short sale?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q25. What documentation will a lender typically require?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q26. Does C.A.R. (California Association of REALTORS) provide special forms for short sales?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q27. Are certain lenders requiring the use of third party online auction services in short sales?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q28. How does the bank utilize the services of the online auction provider in the short sale?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q29. Does the use of online auction service affect the listing brokers commission?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q30. Does the use of an online auction company affect the buyer&#8217;s agents commission?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q31. Is using an online auction platform legal?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q32. Why would an online auction platform require a license?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q33. Since Auction.com generally does advertise and solicit buyers and sellers, should it be licensed?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q34. Don&#8217; online auction companies typically state they are not agents for the Seller?<\/span><\/p>\n<p><span style=\"color: #000000;\">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&#8217;s exclusive listing agreement?<\/span><\/p>\n<p><span style=\"color: #000000;\">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?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q37. Are there causes of action that a listing agent may be able to pursue against a lender for interfering with the listing agreement?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q38. What are the difficulties with pursuing the claims discussed in question 9?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q39. \u00a0What about the lenders who require the listing agent to do additional work (e.g., putting up signs or holding additional open houses)? \u00a0Couldn&#8217;t that additional time count as damages?<\/span><\/p>\n<p><span style=\"color: #000000;\">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. \u00a0If this is true would that create a claim for damages?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q41. Does the buyer&#8217;s agent have any claims against the short sale lender?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q42. Does a listing agent have to agree to participate with the online auction platform?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q43. Why are banks using this platform?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q44. Is there a way to stop this practice?<\/span><\/p>\n<p><span style=\"color: #000000;\">Q45. Where can I obtain additional information?<\/span><\/p>\n<p><span style=\"color: #000000;\">SOURCE: CALIFORNIA ASSOCIATION OF REALTORS\u00ae 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.<\/span><\/p>\n<br\/><!-- Place this tag where you want the +1 button to render. -->\n\t\t\t\t\t\t<div class=\"g-plusone\" data-size=\"standard\" data-annotation=\"inline\" data-width=\"120\"><\/div>\n\t\t\t\t\n\t\t\t\t\t\t<!-- Place this tag after the last +1 button tag. -->\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t<script type=\"text\/javascript\">\n\t\t\t\t\t\twindow.___gcfg = {lang: 'en'};\n\t\t\t\t\t  \t(function() {\n\t\t\t\t\t\t\tvar po = document.createElement('script'); po.type = 'text\/javascript'; po.async = true;\n\t\t\t\t\t\t\tpo.src = 'https:\/\/apis.google.com\/js\/platform.js';\n\t\t\t\t\t\t\tvar s = document.getElementsByTagName('script')[0]; s.parentNode.insertBefore(po, s);\n\t\t\t\t\t  \t})();\n\t\t\t\t\t\t<\/script>","protected":false},"excerpt":{"rendered":"<a title=\"Short Sales\" href=\"https:\/\/exclusive-realestate.net\/wp-content\/uploads\/2014\/10\/Short-Sales.pdf\" target=\"_blank\">Short Sales<\/a>\r\n\r\nAnswers to the following Questions can be accessed by downloading a pdf file linked above:\r\n\r\n<span style=\"color: #000000;\">Q1. \u00a0What options does a lender have on a debt secured by California real property if the borrower does not make the payments on the loan?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q2. What other options may the lender consider instead of foreclosure when the borrower is delinquent?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q3. What is a deficiency judgement?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q4. Under what circumstances is the lender prohibited from going after the \"deficiency balance\" as defined in Question 3 after a short sale?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q5. Can a lender obtain a deficiency judgment against a defaulting borrower following a foreclosure?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q6. Can a lender avoid the \"foreclosure process\" and just sue the borrower on the note (i.e., treat it as an unsecured note)?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q7. Why would a lender agree to accept a short sale?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q8. Is the seller in a short sale relieved of all debt obligations owed to the lender?<\/span>\r\n\r\n<span style=\"color: #000000;\">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?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q10. What language in the lender's \"approval\" letter lets the seller know that the seller in a short sale is <span style=\"text-decoration: underline;\">not<\/span> relieved of any further debt obligations owed to the lender?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q11. So what have lenders been doing if their \"approval\" letter does not relieve the seller of any further debt obligations?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q12. Does a short sale adversely affect a defaulting borrower's credit rating?<\/span>\r\n\r\n<span style=\"color: #000000;\">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. \u00a0Before the foreclosure sale occurs, the borrower pays the lender what is owed on the note. \u00a0Could these activities appear on the borrowers credit report?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q14 Is the method by which lenders report a short sale a negotiable item?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q15. Are there any special risks to borrowers when negotiating a short sale with their lender?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q16. Are there any tax effects of a short sale?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q17. What is a short sale consultant?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q18. Does a short sale consultant have to be a real estate licensee?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q19. Can a licensed shore sale consultant collect an advance fee?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q20. Must a real estate transfer disclosure statement be given to a buyer in a short sale transaction?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q21. Must other disclosures be given to a buyer (or seller) pursuant to a short sale?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q22. Suppose a distressed seller enters into a contract to sell his\/her home to a buyer pursuit to a short sale. \u00a0Should the listing agent inform the lender if and when offers are made on the property?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q23. Should a listing agent working with a distressed seller attempt to negotiate a future listing agreement with the lender?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q24. What is the process for applying for a short sale?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q25. What documentation will a lender typically require?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q26. Does C.A.R. (California Association of REALTORS) provide special forms for short sales?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q27. Are certain lenders requiring the use of third party online auction services in short sales?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q28. How does the bank utilize the services of the online auction provider in the short sale?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q29. Does the use of online auction service affect the listing brokers commission?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q30. Does the use of an online auction company affect the buyer's agents commission?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q31. Is using an online auction platform legal?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q32. Why would an online auction platform require a license?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q33. Since Auction.com generally does advertise and solicit buyers and sellers, should it be licensed?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q34. Don' online auction companies typically state they are not agents for the Seller?<\/span>\r\n\r\n<span style=\"color: #000000;\">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?<\/span>\r\n\r\n<span style=\"color: #000000;\">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?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q37. Are there causes of action that a listing agent may be able to pursue against a lender for interfering with the listing agreement?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q38. What are the difficulties with pursuing the claims discussed in question 9?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q39. \u00a0What about the lenders who require the listing agent to do additional work (e.g., putting up signs or holding additional open houses)? \u00a0Couldn't that additional time count as damages?<\/span>\r\n\r\n<span style=\"color: #000000;\">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. \u00a0If this is true would that create a claim for damages?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q41. Does the buyer's agent have any claims against the short sale lender?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q42. Does a listing agent have to agree to participate with the online auction platform?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q43. Why are banks using this platform?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q44. Is there a way to stop this practice?<\/span>\r\n\r\n<span style=\"color: #000000;\">Q45. Where can I obtain additional information?<\/span>\r\n\r\n<span style=\"color: #000000;\">SOURCE: CALIFORNIA ASSOCIATION OF REALTORS\u00ae 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.<\/span>","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"open","ping_status":"open","template":"","meta":{"footnotes":""},"class_list":["post-2398","page","type-page","status-publish","hentry"],"_links":{"self":[{"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=\/wp\/v2\/pages\/2398","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2398"}],"version-history":[{"count":5,"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=\/wp\/v2\/pages\/2398\/revisions"}],"predecessor-version":[{"id":2406,"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=\/wp\/v2\/pages\/2398\/revisions\/2406"}],"wp:attachment":[{"href":"https:\/\/exclusive-realestate.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2398"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}