I have a short sale with approval from Well Fargo 1st and in discussion with Wells Fargo Home Eq on the 2nd-which has a $50K balance.  Negotiator and seller/owner spoke directly and negotiator indicated that in addition to the $4K the sr lien holder is offering them, they will want $2K cash contribution at closing and after closing will want seller to agree to a payment plan (said they look to recoup 80%).  Obviously this is a proposition that makes no sense to my client.  So he gets introduced to a person through a co-worker that is using this person to help him with Loan Modification.  This "Loss Mitigation Specialist" is a past mortgage broker and offers to try to get a better deal from the 2nd for a fee.  I have my reservations about him and shared them with my client. Just one example- I asked him about the SAFE Act and he didn't seem to know what that even was.  He told me client about a law that Obama passed in 2009 that made it illegal for 2nds to pursue borrowers for the deficiency.  I of course, have never heard nor can find anything of the like.

 

So what's your take?  Are there credible people out there does this and I'm just being too distrusting?  Anybody heard anything about this law?  Any experiences with Wells Fargo Home Equity in particular where they accepted an offer that was pallable for seller? (I had another one with them 2 yrs ago where balance on 2nd was $103K- it went to foreclosure and they sued owners for the $103K)

 

Looking forward to hearing what "great minds" have to share

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The "Loss Mitigation Specialist" may be referring to HAFA wherein if the 2nd agrees to the shortened payoff that they're being offered by the first, then they agree to not pursue a deficiency judgement against the first. However, I have no clue as to what this individual is actually referring to. In my opinion, if your "gut feeling" has you a bit unsettled about this person, then you're probably right. Especially since they have no knowledge of the S.A.F.E. Act and they're a former Mortgage Broker....hmmmmm...... There are some credible people out there who will negotiate on behalf of your clients and I frequently use one of my preferred closing attorneys to do just that. The problem is that there are so many uninformed scandalous people out there who are willing to do just about anything for a buck. If my client insisted on proceeding with this person, I would have him/her sign a waiver releasing me from any liability for the actions (or lack thereof) of this individual. Of course, I'd have my attorney draw it up. Good luck!!!

**Disclaimer...I am not an attorney, nor do I play one on TV. In fact, if I ever played anything on television, it'd definitely be a jazz club singer :)**

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