It all makes sense to me right now! Last October I listed a property. The Seller was very close to being underwater. After trying to market the property at $299,900 and not one single showing and the Seller being unable to make the payments any further we decided a short sale would be in order. We incrementally reduced the price until I recived a cash offer in Feburary for $265,000. Great! the mortgage company. Midland, will love me and I will have this closed out in no time. WRONG!
The Midland mortgage company said we need to get an appraisal, understandable, one month later no appraisal and the Buyer walks. One week later the appraisal comes back at $250,000. Okay! I'm a little upset with the mortgage company thinking that I just lost a sale and they lost $15,000, however, they don't seem to care. I can be patient. Lets start over. The mortgage company agrees.
I put the property back on the market and after a couple of weeks I get 2 offers. One for $249,000 and one for $244,000. We are now in the beginning of April. I submit both offer with full short sale packages to the Midland Mortgage Company because I know what I am doing now and I am a Certified Distressed Property Expert. I'll have the closed in no time!
The mortgage company suprisingly after loseing the first deal just drags their feet! I am constatntly on the phone trying to get them whatever they want. Sometimes sending things 3 and 4 times. Don't know how they lose all of this stuff, but they somehow manage to. The end of May roles around and I get in touch with the negioator somehow and she tells me sorry, we were just about to approve the short sale, but the Seller filed for bankruptcy! Sure they were just about to approve it! She then proceeds to tell me that if they do not get relief within 30 days from the court to sell the property we must start the entire process over again. WHAT! Why would we do that? I work frantically to get it done within 30 days since the hearing is scheduled for relief in 28 days. 28th day approved, great! I call the Midland Mortgage company and said lets move forward. Ya right! they tell me that it needs to be entered into their system which could take 3-4 days. Imagine that! Why would they want to keep carrying this house and losing money? None of this makes sense.
Beginning of July the Midland Mortgage Company tells me they have it in their system, but since it was not entered into their system within the 30 days so I must start from the beginning. All the way up to a supervisor I go, dosen't matter, thats there rules! I can't figure this out for the life of me. Don't they want to get this proven deterioting asset off their books? Buyer #2 walks away!
I am now left with one Buyer who has an offer in for $244,000, $21,000 less then the original offer 5 months ago and the mortgage company still does not care. WHY?
Because, remember, the mortgage company only services the loan. They are not the investor losing the money. But, aren't they obligated to do what is best for the investor? I guess, but I come to find out that the longer they hold onto the loan the more fees they collect, which comes out of the profits from the investors shares and if they are lucky enough to get it to forclosure they then get to run title several times $$$$, give it to a company to sell it $$$$ and insure it $$$$, all of which they normally own or have partnerships with the various enities plus, remember all those cost come out of the investors pocket.
Now it all makes sense why on that other deal I had where I represented the Buyer on a bank owed property they insisted on ordering title and paying for it. They got reimbursed for the title from the investor and made money on the title since it was their title company. Sounds like a great deal for the mortgage company, but not for the investor who could have recouped another $4000 by having the buyer pay for title as is normal in Pennsylvania.
So the incentive for any mortgage company servicing a loan is to hold onto it as long as possible and take it to foreclsorue because at the end of the day that is where they will make the most profit and the investor just continues to lose!
So good luck with short sales, especially if you are dealing with Midland Mortgage Co. and if you are an investor and have Midland Mortgage company servicing your loan, watch out!
Bucks County Homes For Sale
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