This week has been wrought with short sale frustrations on a national level. It is even more frustrating in California. Short Sale Sellers in Tracy and Mountain House listen up.
In the past few weeks we've seen the following:
Wells Fargo and Wachovia stop granting extensions on short sales under most circumstances. Why does this cause frustration? Frequently a short sale seller has been waiting weeks if not months for the bank to respond to their short sale request. Finally an approval is given, however, the time line to close the short sale is too short. The home forecloses because an extension was NOT given. Yes even IF the home is in escrow.
recourse on a loan made on the primary residence of a person living in CA. California is a no-recourse state only on purchase money loans. If you ever refinanced your loan, even if you refinanced only to lower the interest rate, the loan NOW becomes a recourse loan. This is HORRIBLE for short sale sellers. The Governor stated that he did not want to interfere with "the loan contract". OH PLEASE! So now short sale sellers really are in an "IF" position. There is no guarantee that the lender will or will not seek a deficiency judgement when a short sale is approved.
Last, and most recently, Fannie and Freddie instruct servicers (Wells Fargo, Bank of America, JP Morgan, Chase) have postponed foreclosures in 23 states, but NOT California. Again this has to do with whether a foreclosure is a judicial foreclosure. California is not a judicial foreclosure, a judge does not issue a judgement for the property to foreclose. Instead California a trustee state, the property goes to sale at a Trustee Sale.
If there is a silver lining..... short sales are being approved at a faster rate than 3 years ago.
Cell: 209-914-5573 | Direct: 925-679-5573 | Fax 925-226-4645
email: Susan@SusanGoulding.com| website: SusanGoulding.com | Tracy & Mountain House, CA | DRE # 01490605 | Keller Williams Realty | Crown Key Realty | Subscribe to my newsletter by clicking here.
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© 2011 Susan Goulding
About the Author...This article was provided bySusan Goulding, a Nationally recognized Realtor and Certified Short Sale & REO Specialist. Search Northern California real estate and homes for sale: www.SusanGoulding.com. Short Sale information at Short Sale My Tracy Home or Short Sale My Mountain House. Homeowners anywhere in Northern California contact me for more information or visit www.ShortSaleMyTracyHome.com
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9 Comments on Short Sale Frustration in California, Short Sale Northern CA Specialisit
Susan, I actually had luck by calling Freddie mac and etting an extension for 60 days. I understand your frustration, it is a sick system
What the governor did was very frustrating. It doesn't just hurt the homeowners who didn't know, it hurts the entire real estate industry.
I will be a very happy man when we are not talking about short sales anymore. Wonder when that will be??
Susan, I wish Governor would have signed that bill. Short sales are frustrating. I don't understand why Wells Fargo and Wachovia are choosing not to extend and in the middle of escrow!! If they have a sale right there...what's up with that?
The governor made a huge mistake not closing that loophole. I still say we need legislation to speed up the banks response time.
I just got one approved with a 1st and a 2nd with GMAC. The first said it has to close by th 27th, the 2nd said it has to close by the 22nd and the seller just got a notice of trustees sale for the 21st. Not only does the right hand not know what the left hand is doing, I am pretty sure the head isn't controlling either one of them.
Rama - wow Freddie gave you 60 days extension. That's amazing - a sick system indeed
Rob - it DOES hurt the whole real estate industry. Home owners only hear deficiency in a short sale, they don't realize they can get a deficiency judgement with a foreclosure also. Shame on Arnold.
Michael- I love this. I too will be a very happy lady when there are short sales NO MORE.
Pamela - I only wish I knew what Wells and Wachovia were doing. Wachovia was doing things fast and right - now this ugh.
Bryan, I couldn't agree more. You'd think he'd do something for the little people before he's replaced. Shame on Arnold. Legislation to speed up short sales would be great, but really, HOW -- what are the consequences if deadlines are not met?
Ryan - Oh boy - you have a 3 ring circus. I hope you get it closed in time.
Susan - It must have been the red type! I thought you said ... silver lining .... ok, you did! Three years ago it was the exception that closed .... oh, ok .. I get it ... we are doing better?!!
I did say silver lining - not platinum or gold..... we are doing better in closing short sales. Well we were until the banks the HAFA program was released.