Patty's "All Things Real Estate" Blog.

Called the bank to report we have an accepted offer on the property.  I was transferred to the short-sale department – immediately – just like they said.  Well, aside from the zillion questions they ask when they answer the phone; loan number, seller social security number, property address, borrowers names, my name, my company name, contact phone numbers, name of first born child, blood type, grandma’s favorite brownie recipe……you get the idea.  Almost immediately……

The short-sale department advised again to place loan number at top of each page of offer & supporting documentation and fax to their ‘secret’ number.  Allow 10 business days for ‘imaging’ into their system, then call back to verify the status.  List of documents to submit are: Purchase agreement & counter offer, estimated HUD-1 (settlement statement), 2 months pay-stubs, 2 months bank statements, pre-approval letter from buyers lender, past 2 years tax returns, and financial hardship letter. 

It would have been nice to have this list of required documents prior to talking with the short sale department.  That could have saved us another 10 days of document collection.   Anyway, the 30 page fax was sent off to the secret fax number and the waiting period began.

So far, so good.  Everything going according to plan….

Not much happened between the time the bank was contacted and the day the offer is submitted.  Mostly just a period of collecting inforamtion for thefile and collecting financial information from the seller.

September consisted of calling the bank weekly to inquire about status of NOD and the loan balances. Was advised that the lender would need a new financial hardship letter from the seller and recent bank statements.  When offer is obtained on the home all documents need to be faxed and loan numbers need to be written at the top of each page.  If we receive multiple offers, we must negotiate the offers and only send one to the bank for approval.  Again I as advised that I need to call Home Retention with the offer and would be referred to short-sale department instantly.  Was also advised that review and approval process could take up to 4 MONTHS! 

Yikes…..

August 3rd, 2009.  This is my first call to the lender to inquire about their short-sale procedure.  They advised that I need to send a  3rd party authorization form signed by the seller to authorize our brokerage to receive information about the property & mortgage.  Faxed the authorization form to the fax number provided.

August 10th, 2009. I spoke with Customer Service.  They advised that in order to speak to me as the sellers representative the bank has to send a letter to the seller to verify they authorize me as a third party.  They do not have the 3rd party authorization form that I faxed to them on August 3rd.  This person then transferred me to the Loan Modification Department.  Spoke to another rep.   This bank bought out another bank and inherited this loan, but they don’t have the loans transferred over yet .  I was advised that I have to call the previous banks Home Retention department.

Same day:  called the Home Retention department and was advised that they DO have my 3rd party authorization on file!  Was also advised of  the following:

• Need to list the home for sale as soon as possible
• Get updated financial worksheet from the seller
• Notice of default has been issued, but has not gone to foreclosure process yet.
• Loan modification file has been opened but has not been referred to a negotiator yet.
• When offer is received on home, offer needs to be negotiated, then called in to this department.  Information will be given at that time on where to send all documentation.

Same day/same call:  Transferred back to customer service for clarification on notice of default (NOD).  I was advised that I may need to talk to loss mitigation.  Notice of intent to accelerate the loan was sent on June 30th, however no NOD has been issued.  (Didn’t the previous rep tell me the NOD had been issued?  I am confused!). 

Off to install a sign post in the front yard!

It was never my intention to go after short-sale business.  On the contrary, when short-sales started becomingprevalent in our Pleasanton Real Estate market, I made a decision to stay far, far away from these transaction. I thought it would be better to refer this out to an expert than to become one.   My reasons for not wanting a piece of this market were the following: 

• clients have to wait too long,
• banks take too long,
• short-sale departments at the bank are a nightmare to deal with,
• you could possibly work on a deal for 6-months and not get an approval,
• the bank may foreclose before the deal is approved,
• the buyer walk away if it takes too long,
• houses are in sub-standard condition or disrepair

Did I really want to spend my valuable time working on something so futile?  Fast forward to 1-year later and here I am with 3 short-sale listings.  And yes, many of those reasons I just stated are absolutely true!  What has changed for me that I now am involved in the short-sale market? Simple, education and experience.  There is really no other way to do this than to jump into a short sale transaction and endure the process.  In doing so I have found that it is actually something I enjoy.  It is a challenge and everyday there are obstacles and road-blocks, but there are also small successes and an opportunity to learn something new, which in my opinion, just makes me better at what I do.  It is a very different way of doing business, but one that is just as rewarding.

I  have decided to post the saga of one of my short-sale transactions.  This transaction started last year and  isn’t closed yet so I will catch you up on the past history, move into the future, and you can follow along through  the approval and (hopefully) the closing of this transaction.  I will not divulge the specifics of the actual property,  property prices, or any personal information about the parties involved.  This is more about the daily dealings with the financial institutions and what all parties must endure to get a transaction approved and closed.

The saga will begin tomorrow…….

This Sunday, January 10, 2010, our very own Foothill High School will be hosting a recycling event.  Foothill High School is located at 4375 Foothill Road, Pleasanton, at the edge of the Muirwood and Foothill Knolls neighborhoods.

This event is sponsored by Foothill Wrestling and will be accepting your drop-offs from 10am – 4pm.

Please take this opportunity to rid yourself and your home of these recyclables and come out and support the school & team!