Tuesday, June 10, 2008

Citi Short Sales- Less Forgiveness on Second Mortgage Debt?

Is CitiMortgage/CitiFinancial cracking down on Short Sale second mortgage approvals?

Citi Short Sale #1:

First Mortgage: Countrywide- $199,000
Second Mortgage:
Citi- $20,000
Offer: $160,000 (fair market valve)
Seller: Divorce situation, no savings, job loss, new job out-of-state, separate households
Citi Says: Will not accept typical nuisance fee from Countrywide. "Don't waste your time unless seller pays $10,000 cash and another $10,000 in a promissory note. Hire someone to do a BPO". Their system shows a value of $215,000" (That is, I am to hire to third party).

Citi Short Sale #2:

First Mortgage: Saxon - $260,000. Saxon offers Citi $1000 and needs to know if Citi will accept before proceeding on approval.
Second Mortgage: Citi - $100,000
Offer: $230,000 (fair market value)
Seller: Was subject to out-of-state scam, his credit was used to buy property in his name by "investor" who was to pay mortgage for him - and failed to. Seller has no money, semi-retired.
Citi Says: They've turned file over to law firm, Zacheim and Associates. Zacheim says: "If net to Citi is less than 25% of what is owed, then they will require 100% payback of loan of $100,000 over 72 months. Will not accept $1000 buyout from Saxon. Want three years bank statements, three years tax returns. (This does not make any sense).

Both of the above scenarios happened on the same day. I have contacted Citi and asked if this is a blanket policy change- non-forgiveness of second mortgage debt. I was told " Absolutely not", but these scenarios raise serious concerns over the viability of Short Sale approvals with Citi as the second.

It's Wendy!
Wendy Rulnick, Broker, CRP, CRS, GRI, ABR Rulnick Realty, Inc.
Specializing in SHORT SALES and FORECLOSURES on the Emerald Coast of Florida: Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.
Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204

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