Can a private mortgage insurance company ask for a payoff in a short sale?
Question by Jessica Kreider: Can a private mortgage insurance company ask for a payoff in a short sale?
We are trying to buy a property through a short sale. We accepted the bank’s counter, and the file was submitted to the seller’s PMI company. The negotiator came back and said that the insurance company verbally stated they want $ 5,000 cash. The seller can’t cover this, so the agent is asking that we pay it. Can they even ask this? If we say no, the seller obviously can’t pay it. Will the insurance company most likely just foreclose the property, or can this amount be negotiated. Advice?
Best answer:
Answer by Iffy
Yes they can It is an outstanding lien on the property and someone must pay it. Either the seller or the buyer. That is the problem with buying a foreclosure or short sales too many unexpected expenses. Try to negotiate you have nothing to lose but the house
Give your answer to this question below!
PMI is insurance. Why would they want $ 5K? PMI premiums are part of the the mortgage payment. You need to go back to the negotitor and ask him/her why PMI is involved. If they won’t budge, move on to another home. Don’t fall in love with a home until it’s yours.
realtor.sailor
Yes a PMI can kill a short sale. hence why the majority of short sales fail to many parties need to agree to the deal
A short sale unlike an official juridical foreclosure is basically an agreed to contract for all parties invoked on the seller’s side to take less and for the PMI to pay off, in a short sale the PMI is under no obligation to agree to PMI paying off on the insurance policy thus killing the deal where in official foreclosure the PMI is legally bound to pay off on the insurance