Buyer Beware - GMAC Shafts Buyers and Realtors in Short Sale Transaction

Buyer Beware - GMAC Shafts Buyers and Realtors in a Short Sale Transaction

Here is your fair warning...this is a RANT directed at GMAC for shafting my buyer clients and both listing and selling agents in a Charlotte short sale!

My buyers, who I have been working with for TWO YEARS, finally closed on their Charlotte short sale home yesterday, but the journey was fraught with pitfalls, seemingly insurmountable obstacles, lots of stress, and quite a bit of hand-wringing.  Here are the sordid details:

• My buyers reached agreement with the sellers in early April on a short sale in Providence Plantation in South Charlotte. 
• The home, which was perfect for my buyers, nonetheless needs lots of repairs and updates, AND termite treatment!
• The sellers had two mortgages on the property - the first with Litton Loan Servicing, and the second with GMAC.Litton approved the contract in a relatively short time frame;  however, GMAC was not happy with the 10% that Litton was allowing for GMAC, and extorted  demanded an extra $6,100 - from buyers or sellers, they didn't care who.
• Sellers didn't have it; buyers didn't want to pay for GMAC's bad investment decision, so my buyers said "No Deal" to GMAC.
• GMAC takes another month to respond, telling my buyers too bad...if you want the house, you have to pony up the extra $6,100, or else we won't approve the deal.  This is the JUNIOR LIEN holder dictating the terms of the deal!

• My buyers are mentally adding up all the costs of termite treatment, structural repairs, carpet, flooring, appliances, etc.  But even with all of these costs, they determined that it was still worth it to move forward, and they agreed to  pay GMAC their $6,100 ransom.
• GMAC and Litton both issue closing letters specifying net proceeds, closing costs and realtor commissions.  Both banks agreed to our full realtor commissions of 6%.
• GMAC takes so long to respond that closing is postponed.  This delay in closing results in monetary penalties to my buyers (and more stress!)
• My buyers decide to fold these extra costs (GMAC's demand and the penalties) into their mortgage, because they are going to need a lot of cash to spruce up and repair this home.  This decision results in an amended contract with a higher purchase price.  Again, buyer and seller agree.
• Litton responds promptly with approval, but GMAC waits for almost a month...until 2 days before closing, and sends NEW closing instructions reflecting the new sales price, but CUTTING realtor commissions to 5%.  This is after they had already approved 6%.  Understand, GMAC will get the SAME NET, regardless of the realtor commission percentages.
• Remember, the buyer increased the purchase price based on Litton and GMAC numbers, which included 6% in commissions.  If GMAC had stated from the begining that it would only pay 5%, then my buyers could have saved $3100.  But no, they changed the rules at the end of the game.  So my buyers got shafted, and the listing agent and I got shafted - by GMAC which didn't stand to gain or lose ANY money because of commissions.
• Buyers, sellers, and Litton all approved the HUD1 with 6%, but GMAC acted like a spoiled kid and wouldn't respond to emails, answer the phone, or play ball.  Wouldn't talk to the closing attorney, who was waiting to disburse funds and record the deed.  
• Buyers and sellers closed escrow, and the deed was recorded today.  But we still have no answer from GMAC, which means they won....Litton wants its proceeds, and the buyers want to get into their house.  So once again, my buyers are forced to cave in to GMAC's arbitrary and capricious games.