They explained the details and she asked them, "You mean if I could convince my sister to move here and buy my house, that would be okay?". My sister had been trying for 2 years to sell her second home and it was finally suggested to her by Bank of America to attempt a short sale. I just found this posting and even though it's a year later, I'd thought I pass along my experience regarding the Arm's Length Agreement. Lenders and investors will not tolerate "Bail-Out" situations that allows the distressed homeowner to benefit from their loss.
#Florida arms length transaction form mac#
Just be aware that HUD/FHA/VA, Fannie Mae, Freddie Mac & FDIC do not want to see anyone obviously taking advantage of their financial disadvantage. There is nothing unethical or wrong about doing the double close as long as it does not violate the parameters stipulated by the short-sale mortgagee. If the buyer is planning on flipping the property, he or she will have to arrange a double close (or simultaneous closing). Keep in mind, lenders will not accept a sales contract that shows the contract can be assigned. You would be surprised on some of the things that people have attempted to pass through our office thinking no one would know or find out. But (if you have to think twice about this) you need to be very careful and think twice before you sign such a document. This is pretty self explanatory and if these stipulations are non-issues for your particular deal than you should be fine. The Buyer(s) & Seller(s) nor their Agent(s) listed below have any agreements (written or implied) that will allow the Seller(s) to remain in their property as renters or to regain ownership of said property after the successful execution of this short sale transaction.” If the purchaser intends on performing a simultaneous closing (aka flip) such a transaction can take place only if the re-conveyance is of equal or lesser value as to the current sales price indicated in this transaction.
This purchase contract is not assignable. It is further stipulated there are no “hidden terms” or “special understandings” between the seller(s), buyer(s) or their agent(s) in order to entice, induce or otherwise defraud the seller’s mortgagee in this transaction. “Whereas, all parties relevant to this transaction are hereby indicating to XYZ Mortgage Corporation that no party to this contract is a family member or business associate or shares a business interest with the mortgagor(s) or mortgagee. This specific language could be included in the short-sale approval letter itself or may be a totally separate agreement all together (such as in the form of an Affidavit) and can read something to the following effect:
Agents, brokers, sellers and buyers should be aware of the “Arms Length Transaction” affidavit that many lenders/investors are now requiring all parties to sign. Hello to all! I just wanted to send out a quick note to give a heads up on an issue that you should be aware of.īe advised that HUD/FHA/VA, Fannie Mae, Freddie Mac & FDIC are now carefully auditing short-sale transactions going forward and are also looking at previous closed short-sale settlements that may have been considered non-arm's length transactions. BE AWARE OF THE "ARMS LENGTH TRANSACTION" AFFIDAVIT
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