I really enjoyed that Mike....literature and you telling it sure made this ....complete :) Thanks for the info and 'talking' to me :)

To the choir you preach, Mike.  Humanity has been missing from an equation that wouldn't exist without it.  I hope they see this, read this, & take heed to this.  Agreed!

I have 5 Short Sales going now. Can't get anywhere on any. Do you know anyone at Wells Fargo or Countrywide?

Mike, what was the cool thing that I saw when I clicked on your blog? I saw it.....I really did! ;-)

As for your issue on short sales? There are so many hands in the Seller's pocket these days, that I don't see how many of these even go through. Much simpler to pick up a foreclosure...though, even that is a challenge. ;-)

I agree to a certain extent Lady in Red. However, it is better for the lender to do the short sale because the don't have abandon properties everywhere. Its good for the seller because it shows up as late payments with a settled debt opposed to a foreclosure.It's a great thing for the buyer because they are moving into a home that has not been sitting vacant for a long period of time and the  list goes on.

Sally - Thanks.  I'll talk to you everyday : )

Jason - You know it.  Unfortunately they won't see it, read it, or heed it.

Michelle - I know a lot of people.  Drop me an email.

Teri - not sure what you saw.  Can you describe it?

Michelle - it is better for everyone involved on many short sale transactions - but the addition of secret MI completely botches the process and so often kills the deal.  These MI computations are like the BORG.  I won't let them assimilate me!

This is very scary. It's also horrific in that it impacts most those sellers that managed to FIND a legitimate buyer in this market, not those that simply walk away. The latter is going to become more and more preferable if the banks don't get their short sale process figured out a.s.a.p. Thanks for another potential heads up.

You are correct these people look at the situation of a short sales as black and white.  I had one recently where the lender decided since the homeowner was not living in the home they were not going to do the short sale.  I am sure they knew they was not going to do the short sale when the documents were requested.  It is just a cruel game.

Good Rant get braced as it isnt over yet. I have not heard the fat lady singing.

Your experience just confirms to me that short sales are not worth the effort.  Yes, some close, but the time spent would be better used prospecting for new business.

Mike, I've encountered this a couple of time. It's also my understanding that sometimes the lender has to foreclose in order to collect on the insurance. Is that true? 

One of the attorneys I have spoken with stated that signing the promissory note may be a better option than getting foreclosed. He believes the note can be negotiated way down after closing or in the worse case scenario just don't make the payments. OR...file bankruptcy on it. All of these things may be a smaller hit on your credit than the foreclosure.

What are you thoughts?

"Options" -  I'm not all that confident they'll change a thing anytime soon.  Something to keep in mind here - the decision making process is not in the hands of the Lender.  By virtue of the MI policy, it's been passed to the MI Underwriter.

"Taylor Brown"  - That sounds a lot like Countrywide.  They've since reversed their stance.  Check out Momma don’t let your Countrywide Houses go vacant  and then Countrywide Short Sales (updated)

Chip - We're not even close.  "Look we've hit bottom! - NOT"

Joe - They are time consuming, they are incredibly frustrating, yet they are THE action in the Marketplace, and there is no better feeling than helping your clients get out from an ugly situation.

Bryant - We think that's true.  Sometimes the Policy does stip that (we think)  Try and find someone to give you the details on a policy.  See: Conspiracy Theory #17  Signing the Note could be a double edged sword.  Let's assume these are both non recourse loans.  By transferring the balance (or a portion of it) on to an unsecured Promisssory Note - failure to pay that note is grounds for a lawsuit. Since the Note is also unsecured they could be wiped away in the course of BK.  Of course on the other side - you can't squeeze blood from a turnip.   These people are empty.  Your mileage may vary - always consult a legal and tax professional.

Mike, I can't describe it now.......it was a subliminal message that came up behind or layered beneath your site - before it completely opened up. You're pulling my leg, right? It didn't happen this time, so who knows? Something about being very cool, or???

Teri-

Ahah!  That's a little secret message I put into the background image here. http://www.activeraincustomizer.com/img/118-background.jpg 

It's hidden by the white body of this page that overlays on top (according the CSS)

Mike,

We do a ton of short sales, and we haven't encountered this problem.  Perhaps I misread your post . . . but a possible solution could be as simple as asking if there is PMI - do this on the first call when you speak with the LM handling the file.  We've trained our negotiators to do this . . . if the answer is "yes", we just plug in the percentage into our Reo worksheet to get an idea of how the bank is looking at the property.

Mike, this dirty little secret deserves to be aired. It's heart-breaking to the families involved and the agents.  I had heard that NAR had a meeting scheduled this month to discuss short sales, REO's and the qualifications required to be a "true" listing. We have several listings in the MLS that can't be sold...people keep calling, the agent proclaims it can't sell due to bank's failure to agree...so why IS it in our MLS? The only thing consistent about short sales is that they are inconsistent.

Ted - You could ask if there is PMI, and that would be great if the MI was Borrower Paid, Broker Paid or even Lender Paid.  Those policies were placed on the loan at origination.  These were not.  These were placed on either individual loans or more likely pools of loans.  If you are familiar with Mortgage Backed Secuities, the Pooling of loans and the tranching of those pools, that's what happened.  This MI doesn't show up on anyone's radar screen until it goes past the Negotiator level for final approval.  In this instance - what is that payout percentage?  No one will tell you.

Vickie - Thant's the part that gets me - the heartbreaking part.  Not to mention all the others, the Listing Agent, the Buyers Agent, the Buyers, the Loan Officer, the escrow officer.  All of them doing their parts to provide the right solution and get this non performing asset off the Lenders books.  MI kills all that hard work.

Mike this is why YOU are the expert with agents and with people who need to sell their home!  Thanks for the bone you threw me :)

Mike, has anyone else noticed this secret message besides me? How did you do it? ;-)

Renee - you are too kind.

Teri - You are the first!

One of the stinky parts of this (and there are obviously many) comes in consideration of the laws working their way through Congress... As much of the legislation is coming from NC - and we don't have these issues here in NC - they are not taking the Consumer issues with short sales and PMI into consideration.  At one time GE, UG and Radian all had headquarters in NC - and donated a ton of money to campaigns...