My Phoenix short sale client is being charged a $1.00 "processing fee" for his HAFA Short Sale! Thanks Freddie Mac!
I had to read the email from our negotiator several times. Next, I looked at the calendar to see if today was April Fool's Day. FHLMC (Freddie Mac) is actually charging my Phoenix short sale client a $1.00 "processing fee" for his HAFA short sale, and they will not issue our approval letter until they receive it. I asked the negotiator at Lender Processing Services (servicing our BofA HAFA short sale) if there was a typo in his email, or was it some kind of cruel joke.
According to the negotiator, Freddie Mac is now charging homeowners a fee equal to 31% of their gross monthly income for their HAFA short sales. So, if you earn $5,000/month, Freddie will now charge you $1,550.00 as a condition to approving your HAFA short sale. In our case, my client has been unemployed for two years, and has $0.00/month in income. I asked our negotiator to follow along with me on the math. First, you take .31 and multiply it times 0. Doesn't this equal ZERO? Needless to say, it was all I could do to keep myself from blowing a gasket.
But wait, it gets better. I assumed that this $1.00 fee would be handled through escrow. Nope! My client must send a check for $1.00, written out to BofA, just as if it were one of his mortgage payments. Once the $1.00 check clears and is processed, our negotiator will issue an approval letter, and we can close 30 days later. He told me that the short sale has been approved, contingent on receiving the check for ONE STINKING DOLLAR! Folks, I couldn't make this stuff up!
Lets think about this for a moment...As of last month Fannie & Freddie have cost the American taxpayers over $170 Billion, according to most of the articles I've read lately. In October of 2011, the 10 top executives at Fannie & Freddie were payed $12.79 Million in bonuses. They stand in front of the cameras and our fearless leaders in Washington and try to convince everyone that they are doing their best to help homeowners.
And now, to add make matters worse, they are forcing homeowners that are considering a HAFA Phoenix short sale to pay them 31% of their gross monthly income for trying to do the right thing in short selling their home. It's actions like this that make my stomach turn. Forcing a distressed homeowner to write them a check for $1.00 to help offset the costs of conducting a HAFA short sale. What will they think of next?
If this story ticks you off as much as it does me, share it with others and send it to your elected officials. Homeowners are sick and tired of rewarding this egregious behavior by bailing these clowns out, and getting totally disrespected when trying to mitigate their losses. This crap needs to stop, and it needs to stop NOW!