It's been written about before, but judging by the questions that my Short Sale Sellers are asking, it's still a gray area.
"Can my Lender come after me for the difference?"
In California, the answer is a resounding "NO!" (Exceptions of course..read on)
Jan. 1, 2011 saw Section 580e of the Civil Code of Civil Procedure come into effect. July 15, 2011 saw it expanded to offer more Seller protections..
What types of Loans are covered under section 580e? (One to four residential units)
- PML (Purchase Money)
- Rate and term refinance
- Cash out refinance
- Owner occupied
- Rental
- Second home or Vacation home
- Although your Lender cannot REQUIRE you to contribute money, you may voluntarily offer a cash contribution to get the deal done.
- Before writing an offer, see how much the Lender is going to write off. Huge deficiences may become an issue in getting an approval.
Kimberley Kelly, SFR, HAFA, "The Short Sale Specialist" for the Palm Springs, Calif. area (760) 285-3578
I List, work and CLOSE my Short Sale Listings; no 3rd party used
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Great information, thank you for getting the work out Kim!