What is the best way to go about asking the bank to include "full satisfaction of the note with no further recourse for a deficiency judgement" on the acceptance letter?
It seems the banks are playing with the verbiage these days to include less and less leaving the door wide open to come back later for a deficiency. I received a letter today sparce verbiage only stating they were willing to accpt the short sale if we satisfied some conditions. Does anyone have any advise as to how to pose to the bank and convince them to change the verbiage to protect my client? The bank FDIC as receiver for Franklin Bank.

What we do is mention what we are asking for in the Offer Sheet that we send when we first submit the package. Then we don't talk about it again until receieving the acceptance letter.

Of course the acceptance letter will state what they normally do just as yours does. But at that point we call the loss mitigator back. I explain that I'm surprised, shocked even, that they haven't complied with what we were asking for from the start (which the mitigator either never noticed or forgot about lon ago).

Then I explain that the seller says he isn't going to sell unless the lender agrees to what we were asking for. After all he's done what he could in a tough situation to try to help the lender the best he could. He wasn't just some deadbeat who just walked away from the house. And now after all his extra effort the lender repays him by treating this way?!? Well he's offended.

At this point after the lender has accepted the deal, they know they have a viable deal that they want. It really doesn't make a bit of difference to the lender how this is reported to the credit agencies. So most of the time they will do what we ask.

Does it work all the time? No, but it does work a high percentage of the time.

I do believe that some lenders (or investors) have policies that are written in stone, and some have policies that are written in sand, and some really don't have much of a policy at all.

We don't talk about this until after acceptance because it's like trying to pick a fight when neither you nor the loss mitigator knows if the deal is going to be approved. There is no reason to bring this up at that point.

When you do bring it up after acceptance don't be surprised if they say no at first. Tell them that you'll talk with the seller again, then call back a day or two later with the same story. But of course now that darn seller is even angrier!

Basically your calling the lenders bluff. If it turns out not to be a bluff, oh well, you did the best you could.

Give this a try and let us know how this works for you.

Chris

Chris

Thanks for the reply. I do just as you. I put our request in the initial fax cover with the package. This lender is FDIC acting as representative for Franklin Bank. They are not budging one bit. They said that is there one and only standard letter. It doesn't even state they will release the lien which the Title company had an issue with. The Title Co. even emailed asking for a change in verbiage to cover themselves. The answer was the same "no". They went as far as to say they would recind acceptance if the deal was contingent on the edit of the letter. The negotiator did email us that once the money was received at closing they would release the lien so I do have that in writing. I would just like some reassurance that they will not come back for further recourse at some later date. My seller has agreed to go forward. He doesn't have any other option right now.

In many cases, the verbiage on these approval letters come from the bank's legal department and it cannot be changed because it is used across the board with all approvals.

It seems like the smaller banks/servicers are the ones that will typically have on the approval letter that they are giving the homeowner a full release of liability and will not pursue them later.