For Short Sale Sellers. Make the Calls Stop!!! Pleeeeaaasaasssseeee!
If you are a short sale seller and you are either late or going to become late, you will eventually receive those dreaded phone calls from the collection department of your lender. Looking for that payment or when you will make that payment. This is one of the hardest moments for short sale sellers who have never been late in their life.
When we are working with short sale clients, one of the very first questions we receive is can we make the collection calls stop. The short answer is no... but we do offer some insight and suggestions on how to manage those phone calls.
The first thing to know is that the lenders generally have three separate departments who may be in contact with you. The servicing(collection) department; the short sale/loss mitigation department; or, if you are already down a few payments, and the foreclosure department. They are three distinct and separate divisions with completely different marching orders. They may be in communication with each other or not at all. It is best to assume that they do NOT communicate smoothly. Collections job is to track and obtain payments, short sale-loss mitigation is involved in the process of obtaining documents for the ultimate approval of your short sale; foreclosure - the legal process the bank will use in each state to eventually reclaim ownership of the property.
Mot of the calls will come from the collections department. Talk to them, provide them the information that you are selling your home via a short sale, provide them with your listing agent's name and contact information. If you are still in the home, tell them that fact. One of the lender's largest concerns beyond payment is the security of the home. A seller remaining in the home and taking care of the property is an important fact for that lender.
The short sale/loss mitigation department may bypass the agent and go direct to you via phone or mail to schedule what is known as a BPO/Appraisal. That appointment can be one of the best steps in completing a successful short sale. Advise your agent of any direct communication you receive from your lender and/or any letters that arrive.
The foreclosure department. Their job is to plan for eventual taking of the home. The house is NOT theirs until the foreclosure is completed, but they can react to property that is abandoned or not secure. There have been stories of home locks being changed with the seller's still living there; primarily due to lack of communication. The foreclosure process continues regardless of the status of collections or short sale unless the short sale department requests an extension. In California we have approximately 3 months and 21 days minimum for a lender to foreclosure from the date they record the Notice of Default. More than likely, you will not hear from the foreclosure department via phone; instead you will receive written communication from the trustee who is acting on behalf of the bank. Again.... let your listing agent know of any communications from your lender.
So.... there are many departments that may be in communication with you and making that dreaded phone ring. You may receive calls every day or none at all. If you are on the redial daily list, you probably won't answer all of them. For our seller's we tell them to at least communicate weekly. Take a least one of the those calls and continue to assure your lender that you are working hard to sell and complete the short sale and continuing to protect and secure the home. It can be irritating that each call comes from a different person and they might not seem to be aware of the previous calls. For some lenders, this is just they way it goes.
Know that you are not alone and that these calls are not personal. Each of these departments just have to do their job and our seller's seem to have an easier time of managing those calls once we have explained the process. So... we cannot make them stop, but understanding the process certainly can make them more manageable and much less intrusive in your life. With more knowledge you can regain some control over the process. Happy Answering!