Wells Fargo says - No More Extensions!
On Friday, September 17th 2010, Wells Fargo sent the following memo out to mortgage brokers.
"Due to recent industry changes, we at Wells Fargo will no longer be granting any extensions for short sale close dates or postponing foreclosure/trustee sale dates. If you were issued an extension letter dated 9/14 or earlier, those extensions will be honored, but no further extensions will be granted. Files must close by the exp. date on the original approval letter or they will be removed."
This means that if you are involved in the purchase or sale side of a short sale or foreclosure property owned by Wells Fargo, you will need to be able to close your transaction on time. Or else!
If you are a buyer's agent, before you make an offer on a property owned by Wells Fargo, check your time frame with the listings agent before submitting an offer. If the house is two weeks away from auction, unless you have a cash buyer, there's not much point in entering into contract. Actually this is good procedure at any time. I always try to find out where they are in the process on a short sale before we make an offer. No on wants to be on hold for months with a non-approved short sale.
Appraisal, termite and home inspection issues can delay or derail any deal. Before making an offer on a short sale on a Wells Fargo owned property, it would probably be best to request a minimum of 45 days to close escrow, if at all possible, and longer would be better if they will accept it, which they probably won't. Here in California, the whole process of requesting an appraisal has become longer and more convoluted, with more steps and requirements along the way.
This seems to be very counter-productive on the part of Well Fargo. Instead of facilitating short sales, they are making closing a sale even MORE difficult! Do they WANT to force more homes to auction or foreclosure? What "recent industry changes" motivated this? It's tempting to try to find out the leinholder on all short sales before making any offers and just boycott this bank. Is this just a sneaky way to try and steal a few earnest money deposits along the way? Ya gotta wonder...
We still have a lot of great homes for sale here in Temecula, CA. I guess now we have to hope that the ones our buyers want are NOT owned by Wells Fargo.
Good luck out there in the wilds of this real estate market!