I always wondered if the selling bank in a short sale would find it more apealing to have the buyer finance the purchase of the property through them. Would there be a conflict of interest at the time of purchase? Or would it even matter at all?
I was again faced with this today when giving out names of lenders to an out of state buyer. Should this person have the choice of financing with the same bank, or is it in their best interest not to?
Good question Stephanie,
I'm thinking to myself, "conflict of interest", but then again you can't just intentionally not include the selling bank can you??
It'll be interesting to see how this turns out.
It really shouldn't matter. We are starting to see some lenders asking for the buyers to get a review (prequal) by the lender that is current with the mortgage so that they can get access to the financials. It might make them move quicker. I would just ask that the price be resolved beforethey get a look at a prospective buyer's financials so as to not try and jack up the value.
Actually, it sometimes helps the buyer procure the property and oputs more money back into the bank. I have an REO like that right now where the people stand a better chance if they use the bank who owns the foreclosure.
I have found that yes... that does help with short sales, if you use the same lender... it gives them incentive.
I see no conflict of interest at all. And I can spot one a continent away.
The lender is taking it in the shorts in phase one. If they make an honest profit on phase 2, maybe they will be able to pay Uncle Sam back faster.
Talk about win-win-win!
Thank you. This has been very helpful.