Comments on: Buy And Bail…A New Twist On ‘Just Walk Away’

By: Erik Abraham

Erik Abraham — Tue, 11 Nov 2008 05:54:19 +0000

Juliette Sherrill , Fannie Mae is getting bailed out with millions from the Feds but what about the consumer that fell into the plummeting housing marketin in the late stages? Where is their relief or bail out? Bad credit for the next 5-7 years and threats of lawsuits because there mortgage blew up or the have to relocate due to a job transfer? The market has to move somehow and I see nothing wrong with Buy and Bail. Would you rather have someone move out of there current house and into an apartment for the next decade or have them take another foreclosure off the market? These houses have to move somehow and with the new FHA policy regarding Buy and Bail the market will only get more stagnant.

Juliette, Real Estate Agents for the most part are scoundrels and have no ethics, so please spare us.

By: Juliette Sherrill

Juliette Sherrill — Mon, 25 Aug 2008 14:50:27 +0000

What an embarrassment to our Profession!

Why does one think that they are justified in walking away from a contractual agreement to purchase real estate just because the value of the real estate went down? News Flash - that is the risk one takes. When one invests in stocks and the value goes down should we all come to the rescue? Does that give one the right to default on ones promise?

I am thankful that in a true hardship there is some grace, but to buy and bail because your property value went down is unbelievable. Any real estate agent who encourages this behavior has purposely blanked out on ethics and the golden rule. Behind the loan of monies are real human beings who invested in and gave these buyers the chance of home ownership, without whom they would still be renters.

We as Real Estate Agents are to uphold the highest standard of ethics. I suggest that we never knowingly participate in that kind of transaction.

Thinking people will view agents who do participate in “buy and bail” with continued contempt - that of being lower than a used car salesman. Unfourtunately it makes us all look bad. It just lends more truth to the belief that all agents are just out to make a buck at anyone’s expense.

By: Marie Goodloe

Marie Goodloe — Wed, 13 Aug 2008 12:38:49 +0000

Hi Chris,

Short Sale & Shory Payoff are the same…when you sale, you Payoff the loan Short. Year ago I did the exact same the with a home I owned for 10+ years, to get my family into a better neighborhood.

By: Chris Ormsbee

Chris Ormsbee — Tue, 12 Aug 2008 20:34:14 +0000

I understand how this could be fraudulent, however, it seems motive and circumstance could play a role in deciding this. I have clients who were legitimately relocated in their job. They are not yet behind on their payments on their old home because they had received 6 months of extra money for the transfer to cover them, however they are out of time and have relocated to a new area and had always planned on buying after relocating even before tbey knew their old home would not sell for what they owed on it. A local lender suggested they try to purchase a home now before the other bank closes with a “Short Payoff”, in other words not in Foreclosure, just discounting based on market conditions and legitimate client hardship.

It seems to me that if this were the case and the bank agrees to discount and the borrower has never been late on payments, it shouldn’t affect their credit as a “Short Sale” would.

I am unclear if the “Short Payoff” vs “Short Sale” are treated any differently on a persons credit. The new FHA guidelines seem to treat them the same.

Someone trading homes just to get out of being upside down on their current home, does seem like fraud, but like everything I think there may be some exceptions, but unfortunately underwriters and regulators will likely swing too far the other direction before reaching an equilibrium.