Comments on: AZ Short Sales & Promissory Notes

By: Ellyn Pollack

Ellyn Pollack — Sat, 21 May 2011 02:47:22 +0000

I have heard of people signing the pormissory note, making the payments for 6-12 months, and then going back to the bank to renegotiate the balance. Since it is an unsecured loan, they have some leverage in negoiating a lower amount. It is not a guarantee, but a possibility.

What I want to know is — how many people (percentage) sign the promissory note and then default on that note. I tried googling this. Does anyone have that statistic?

By: Tara

Tara — Thu, 14 Apr 2011 14:59:47 +0000

Same scenario, bank approved 250,000 offer, and now asks for 50,000 promissory note. The lawyers for the realtor did say ask what amount we could pay and they would try and negotiate a lower amount, which made me very skeptical.

I was curious-if the original mortgage was 390,00, approximate payments of 140,000 made buyers, what justifies the 50,000 note?

Also, aren’t the banks getting stimulus money? Is there a way to find out if Wells Fargo is in the program?

By: Dan DeNuccio

Dan DeNuccio — Mon, 27 Jul 2009 22:55:21 +0000

Our best bet is to have the seller agree up front that if the bank approves the sale but insists on a promissory note, they agree to accept it. If not, don’t bother with the listing. It will most likely end up in foreclosure and everyone wasted their time.

By: TJ Voskuhl

TJ Voskuhl — Tue, 19 May 2009 19:02:54 +0000

Argh x10! I just rec’d the exact same situation as Elise described above. What surprises me is the difference the short sale offer and the appraisal that Countrywide/Bank of America received (fair market value) was only a few thousand (maybe 5k). BOA is saying that the MI company is the one seeking the Promissory Note (which they sent with the email) before they will approve the short sale. Honestly, I’ve seen this happen before with MI companies seeking to try and get more out of the deal – but NOT when the difference between appraisal and fair market value (appraisal) is so SMALL!

What frustrates me more is that I just suggested that the buyer (because the seller is not able) wants to negotiate the MI note and assume the judgment on the note, that we’d try to pursue that angle. If what I understand from Elise’s email above is any indication, the bank is going to tell me the same thing IF the buyer would even be willing.

You’re right – it doesn’t make any sense to me. I’ve advised the seller and buyer of their options; including the seller telling them “fine; continue forclosure proceedings; I’ll just file bankruptcy”. Sounds like everybody would be better off. The property continues to fall apart because it’s sitting there vacant with Oklahoma storms taking it’s toll on the property. It would serve BOA right to get the property back. Let them try to sell the piece of junk! I’m not making anything off this anyway – was simply trying to help this poor seller.

I just feel bad that it has taken since October 2008 (It’s May 2009) to get to this point.

Insane.

TJ Voskuhl
McGraw Realtors
Tulsa, OK
918-557-1214
tjsells@cox.net