You’ve all heard the story before, months and months of laboring to get the short sale approval, you finally get it and the second lien holder or mortgage company will not accept what the first lien holder is agreeing to pay them.  Result:  Now your short sale is held hostage.  The first will not pay more, the second will not accept less.  What are the alternatives to get this approved after so much hard work?short_sale

Well, first of all, anyone negotiating or selling their home in a short sale must be familiar with their rights. Under the HAFA (Home Affordable Foreclosure Alternative) Program, the first lien holder MUST, not may, MUST, pay the 2nd lien holder $8,500.00. There are rules that regulate this payout and therefore the 1st lien holder can not wiggle its way out of this.  And the 2nd lien holders are keenly aware of these regulations.

Now, if the short sale falls outside of the HAFA Program, then you have a dilemma.  For the most part, the 1st lien holder will request a payoff statement of the first and typically (I say typically because in short sales there is nothing typical), they will pay 10% or a maximum of $6,000.00

“I have been negotiating short sales for quite some time and they (the lenders), for the most part, do adhere to the 10% rule.  But, in the event they pay less and the 2nd lien holder demands more, this is NOT necessarily the end of the line.  There are still options.  If the borrower is receiving an incentive at closing from the 1st lien holder, the 1st bank will allow the borrower/seller to contribute that money towards paying off the 2nd.  They will also permit you to enter into a promissory note, usually at 0% interest, ten (10) years, in order to reach that number.  Or, in the alternative, all the other parties in the game can make some contributions. Often times, realtors as well as the buyer are agreeable to making certain concession in order for the great deal to go through.  After all, if the closing falls through, the nobody gets paid and the buyer doesnt get their property.”  –  Jacqueline A. Salcines, Esq.

So, while the 2nd lien holder can certainly hold a short sale hostage and there are no laws you can use to force them to agree to a payout, there are still some alternatives to make the short sale go through to closing.

Short sales are crafty games played by crafty players.  Everyone has to have some skin in the game to make the process work smoothly.

And, if it goes smoothly, then as in any games, there will be many winners, and perhaps a few losers (the banks).

Dont go it alone. Consult a professional real estate lawyer to handle your mortgage problems.  We are a phone call away.


JACQUELINE A. SALCINES, ESQ.     TELEPHONE:  305  | 669 | 5280



The Responsible Homeowner Refinancing Act of 2013 was reintroduced this week for approval by Congress. Home floating on a life preserver.

This bill, if passed, will benefit responsible homeowners who have stayed afloat and maintained their mortgage payments current, despite their home values being upside down.  Responsible for the introduction of this bill are U.S. Senators Robert Menendez (NJ) and Barbara Boxer (CA).  First introduced in the 112th Congress but not passed, the bill is now gaining momentum again.  Perhaps more relevant now that the housing market is experiencing a recovery, though not quick enough for underwater homeowners  who have been unable to modify for too much income, and unable to refinance for too little equity.  This bill will also affect the impending wave of new foreclosures predicted for 2013, removing some homeowners from foreclosures all together.

Under the proposed bill, hardworking, responsible homeowners who entered into high interest, or interest only loans, will be able to refinance,  and reap the reward of current interest rates which are at 3.53 percent.  Responsible homeowners will be able to avoid foreclosure and have some money in their pockets.

The bill, which will enchance the current HARP program, seeks to eliminate the requirements that borrowers verify income or employment, as under the current HARP rules. The bill will also affect that manner in which appraisals are approved and handled, and reduce the cost and time for borrowers and lenders alike.  It will also extend the HARP program by one more year, through the end of 2014.

“This is great news for the underwater homeowner.  The HARP program has been fantastic in throwing a life preserver to the homeowner that is current on their mortgage and we have seen many mortgages reduced through principal reductions.  I am glad that Congress is taking note of the homeowners and how they are suffering in the current state of our real estate market.” Jacqueline A. Salcines, Esq.

So, this is more good news for underwater homeowners!  Now, if only the real estate market will continue to improve, we sseem to be almost out of the woods!!

DONT GO IT ALONE.  For more information on whether you qualify for a HARP Refinance, modificaiton, short sale or other relief, call me anytime.

Jacqueline A. Salcines, Esq.

Jacqueline A. Salcines, PA

A law firm dedicated to all of your real estate needs.

305 |  669  |  5280

Many buyers and sellers are on pins and needles… not knowing whether to take the plunge and buy a property or place their homes on the market and take a chance that they are making the best profit.  Certainly no one expected the housing market, paricularly the Miami, Coral Gables and Pinecrest areas, to go up so dramatically since the bubble exploded.  However, the wave of recent sales and the return to the 10 contract deals, has certainly put the market back in the sellers hands. 20130201-182045.jpg

So, to invest or not to invest?  That is the question.  TrustED market researchers and forecasters predict a steady 1% to 3 % increase in home prices in 2013, but is this accurate? Afterall, Miami, Florida is certainly not the norm, and in some areas, prices are inching back to 2003 and 2004 levels.  Certainly, the market has turned the corner and the chances of the bubble burting again, are very slender.

There is also the issues of the Mortgage Interest Tax Deduction that will impact recovery. While most tax specialists expect a “cap” rather than a full elimination, for the LUXURY HOME BUYER and higher income folks, this is something that needs to be considered as it may affect their benefits from the tax deduction.

Sales are also being helped by record low mortgage rates, lower unemployment and a decrease in distressed home sales.  This is causing an improved demand for homes, specifically in the South Florida area, where inventory is so diminshed.

The National Association of Realtors reported that while December sales were just slighly below November, sales for the full year (2011) were the best we’ve seen since 2007.  Source: National Association of Realtors.

“As a real estate professional in the business for more than 15 years, the best advice I can give for navigating the 2013 real estate market is to hire the right team of professionals, including a knowledgeable attorney to check title and a realtor who can assess home values, comparables in the area, as well as determine the best price to come in at or list at.  This will remove your competition and provide you with peace of mind that you are buying or selling at the best price, a price supported by our presend day real estate market.”  Jacqueline A. Salcines, Esq.





Short sales for the third and fourth quarter of 2012 reported a record high, according to a report by the Federal Housing Agency.  In fact, short sales and deed in lieus were up 23 percent from the prior year 2011 while REO inventories were down by 36 percent, from their peak in 2010.  Source:  Inman News short_sales

So… to what do we owe this increase in short sales?  Are the banks being more cooperative or have they finally come to their senses? Well, the culprit could be the length of time it is taking to negotiate and close a short sale.  Whereas before the banks had few trained experts and representatives to streamline the process, or the majority seemed they were “in training”, today, “as soon as a short sale is submitted to the lender, almost instantly assigned Short Sale Specialist reaches out to us” says Jacqueline A. Salcines, Esq, an attorney who devotes half of her real estate law practice to selling and negotiating the short sales on behalf of her clients.  “There is no longer that short sale abyss we witnessed in 2011 and the beginning of 2012. The banks finally got their act together and we are seeing them close as soon as 45 to 60 days from submission”.

Most of the credit also must be given to sweeping change in legislature and regulations. On November 1, 2012, Fannie Mae and Freddie Mac instilled new directives that streamlined short sales including

  • Mortgage servicers had to make a decision on the short sale within 30 days from receipt of the application.
  • Mortgage servicers were required to confirm receipt of the short sale application within three days of submissions
  • Weekly updates to the agents became mandatory
  • Mortgage servicers could approve short sales without having to wait for PMI approval
  • Offering additoinal incentives to homeowners for moving costs in the sum of $3,000.00

Source: ” The Shorter Short Sale: Long on Borrower Benefits”  Freddie Mac Executive Perspetives BLog (Jan. 22, 2013)

Additionally, many dont know that they qualify for a short sale even if your home is worth over a million dollars or the loan to be paid off is a Jumbo Loan, or you are a foreign national.  Short sale rules and regulations have become very “realistic” to not sue the word “lax”. But, all in all, mortgage giants like Fannie Mae and Freddie Mac, as well as most lenders, have realized the cost of foreclosing and taking on an REO propertys far surpass that of short selling. The proof is in the amount of incentives they continue to give the borrowers, sometimes as much as $26,000.00, even in 2012!

The most important tool whether your are buying or selling a short sale continues to be… DONT GO IT ALONE.  Employ a qualified real estate attorney to review and examine title, specially if the home is in foreclosure, review liens oon the property, encumbrances, as well as handle the negotiation between the borrower and the short sale lender. “I am always astounded when clients come to me and tell me they have been negotiating their short sale without an attorney for the past 12 months without any closure in sight.  It is no surprise that either the short sale is not approved, or more informaiton is required, endlessly or worse, a denial is made that is not merited.  This is when the services of an attorney/accountant are of most value.”  Jacqueline A. Salcines, Esq.

Whether you want to gracefully exit or immediately dump a property you can no longer afford, call us to run your finanicals and see if a short sale is in your future.