It’s no secret that completing a short sale can be confusing and frustrating for the seller. One thing that is often overlooked, that can save a LOT of headache, is who’s name is on the title and who’s name is on the mortgage.
There are many circumstances that cause these names to be different, the main one being if one buyer doesn’t have the credit or income to be named on the loan, but both buyers want to be considered “homeowners” regardless.
Below are some questions you may be asking yourself:
- How does this affect the sales contract? Any documents pertaining to the sale of the property (any contracts or disclosures) must have the names and signatures of whoever is on the title, regardless of whose on the loan.
- How does this affect the short sale packet? The Third Party Lender will only require documents from whoever is named on the loan, regardless of who is named on title. That means that if only 1 homeowner is named on the loan, paystubs and bank statements for the other don’t need to be submitted or included in any financial statements. Unfortunately, this means their debt can’t be used to prove a hardship either.
- How do I find out who is the on the loan and who is on the title? Your monthly loan statements will indicate the names of every person who is named on the loan. You can contact the title company who closed the transaction, or you can contact your Country Recorders Office, to find out who is named on the title. If you currently have your property listed with a Realtor ®, they will have ordered a Property Report from their title company, which will also have this information on it.
Having a missing signature on a contract can severely slow down the transaction process. Submitted financials for someone who isn’t on the loan can confuse the bank and end in them declining a sale based off financial information they shouldn’t technically be taking into consideration. So, before you sign a purchase contract or submit your hardship packet, make sure you’re clear who needs to sign what and whose financials have to be included. If you have any other questions regarding a short sale or the sale of your home, please contact the Frei Team to assist you with all your needs!