I am following up on an answer to the following question we received about short sale deficiencies. “We have a first mortgage with EMC. Just got an approval letter on a short sale. NO language in letter that says ”satisfied in full” or words to that effect.

It only says “conditions for EMC’s acceptance of this discounted payoff are X.” Will they sell the note to a collection company and then hound us for years to come?

There are a few types of loans that commonly ask for a promissory note, (although any lender may do so.)

The ones that more typically ask for a promissory note (or who simply retain the right to pursue a difficency) are loans that are owned by the lender you originally got the loan from. A good example is a credit union loan, or a small community bank. Another common type are loans that were granted with Private Mortgage Insurance. In our experience, these companies are very demanding. They negotiate hard and say they will not approve a short sale without a promissory note. However, that is not always the case.

Prove to them that you don’t have any assets, nor any extra monthly income. Your agent will show them that they are better off accepting the short sale. Most of the time they will waive the promissory note and accept what they can get. After all, something is better than nothing. Make sense?

If you are considering a short sale and are worried about the deficiency, then give me a call at 858-775-0098. When you contact me, I will research your situation and the type of loan you have. Based on that research I can give you my opinion on the deficiency.

The above is my opinion. It is not legal or accounting advice. Please contact a competent attorney or other professional because the circumstances vary, depending upon your specific situation.

Thanks for reading this,

Arthur Chatroo

Arthur Chatroo is a real estate broker-associate at Realty Experts.

Phone: 858-775-0098

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Arthur Chatroo specializes in loan modification assistance and short sales in North San Diego County.

Copyright 2010 SFI Marketing Institute, LLC. All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Chatroo’s personal views and do not reflect the views of Realty Experts. This information on North San Diego County Short Sales is being provided as a courtesy to our readers to suggest what they may want to consider in the areas discussed.