How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Law Educator, Esq. Your Own Question
Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 111579
Experience:  Licensed attorney practicing landlord-tenant, land use and other real estate law and litigation.
10285032
Type Your Real Estate Law Question Here...
Law Educator, Esq. is online now
A new question is answered every 9 seconds

I have a short sale going with PennyMac. There is only one

Customer Question

I have a short sale going with PennyMac. There is only one lien on the property, theirs, yet we have been waiting to hear literally anything since August. In January we were told it was under review at HUD but have never been provided any update since then or any time frame to expect and answer.
Five months since we started the short sale process with an offer coming in the first 3 weeks, we got notice of foreclosure. They now have a judgment against us and will take the house by short sale in the next 3 months if we don't pay them in full.
We have been working very hard to avoid a foreclosure but PennyMac is delaying everything and never gives us any answers. Aren't there some rules they need to work under to give home owners some time frame by when they need to make a decision?
It is a miracle that the buyer is hanging in and still wants the home. But now we are really under the gun and have a foreclosure on our record when we really should not have since we have had a viable buyer all along. To make things worse in our minds, we have been paying private mortgage insurance, so they wouldn't even have a loss as far as I know.
Can we go after them for failing to work in a timely manner to resolve the short sale? We have literally heard nothing and now thanks to their unwillingness to work with us, they have damaged our credit significantly with the foreclosure being on our records.
Submitted: 8 months ago.
Category: Real Estate Law
Expert:  WiseOwl58 replied 8 months ago.
I suggest that you put in a request with the county court for approval of the short sale, and then Penny Mac will recieve notice of the court date and approve your transaction. Once they have approved it, you can request the court to take it off calendar, but the notice from the court will spur Penny Mac into action and response to you. It works, I assure you from much experience. Please rate 4 or 5 and close out the question. Good luck to you. I wish you all the best.
Expert:  WiseOwl58 replied 8 months ago.
Now, please rate 4 or 5 and close out the question. Good luck to you. I wish you all the best.
Expert:  WiseOwl58 replied 8 months ago.
Please rate 4 or 5 and close out the question. Good luck to you. I wish you all the best.
Expert:  Law Educator, Esq. replied 8 months ago.
Thank you for your question. As per your request, I am a DIFFERENT CONTRIBUTOR and I look forward to working with you to provide you the information you are seeking for educational purposes only.
If the lender refuses to approve the short sale and is giving you the run around to foreclose, this may be considered an unfair and deceptive practice, if the short sale is not for a reasonable amount. Ultimately, the lender has the final say on any short sale, but they cannot give unreasonable delay in order to foreclose, they must give you an answer either yes or no. So, if they are unreasonably delaying the process, you have to file suit in court against the lender for unfair and deceptive practices and seek to get a judgment against them for damages for the delay in the short sale process and also for an order to approve the short sale.
However, you need to be aware, Penny Mac as the lender has the final approval on any short sale and does not have to approve one, that is at their sole discretion, but they must at least give you an answer on approval and failure to do so would be the basis for you suing.
Customer: replied 8 months ago.
Thank you ... Your answer was much more in line with what I was thinking. Would you agree that if we started the short sale process in August and it is now April and we have not had any update regarding how long it may take, not to mentioned a definitive yes or no that would be ground for significant damages?Any other legal claims besides unfair and deceptive practices you can think of?Are there any federal laws or guidelines that require them to get back to us in a certain amount of time? Does HUD have any regulations requiring an answer in a certain period of time?Thanks.
Expert:  Law Educator, Esq. replied 8 months ago.
Thank you for your reply.
Yes, I would agree that there seems to be unreasonable delay and potential for the unfair and deceptive practice claim against the lender, but it requires you to prove the short sale price is reasonable and commensurate with property values in the area. There is no way to give you a "definitive yes or no" as I am going based off of only your representations and do not have the evidence in front of me to evaluate.
The laws do not put a time limit on them to respond. The lender never has to approve a short sale, but they also cannot give you the run around, which is the unfair and deceptive practice and breach of the implied duty of good faith in every business dealing.

Related Real Estate Law Questions