Shocking Lender Actions

Kerry- Countrywide doesn't communicate internally very well. The listing agent should have been on top of the time table. Obviously the negotiator at Countrywide wasn't. They were just countering, and time ran out.

Many lenders are big organizations with different people making decisions with different objectives.  With short sales you have to make sure you are talking and dealing with the right person. 

I haven't heard about it in the media, but I have seen a few blog posts on AR to that effect.  I think it's happening a lot more often that any of us know. 

I have to disagree Mark. I had a home with Countrywide and they said that it was being SOLD January 7, 2008. The people moved out the weekend before. Last week they sent them a letter that states they were approved for a workout. So now I am relisting the home as a Short Sale. With as many foreclosures that are on the market another property is not what the bank wants. So I normally talk a lot when I am on the phone with the negottiator because the call is being recorded for training and other purposes. SMILE

Countrywide did the same thing to me.  I had a full price offer on a short sale and they countered back by raising the price of the house $10,000.  Then foreclosed on the property and listed it $10,000 below the full price offer.  It doesn't make good sense.

 I don't know if this is a problem caused by a poorly run loss/mitigation department or if Countrywide is at the mercy of their investors.  If the investor doesn't sign off on the offer there is not much Countrywide can do about it.

WoW Kerry..... this is a sad situation....... Seems like someone dropped the ball somewhere...

Hey Kerry.  It's a similar scenario in Florida.  So many short sales, so little brains.  It seems like logic would emerge: get a BPO, get a contract for close to that, get paid.  But a lot of lenders haven't caught on and they are going to take it on the chin even more in the coming days.  CW included.

If a loss mitigation manager signs off on a loss that exceeds the banks guidelines, however reasonable the offer might be, that's a decision that has to be justified at some point.  However, if he turns down the offer and the property becomes REO, it's some other departments problem...

At this moment I am in the middle of a CW REO.... we want to close on the 31st and this is an automated approval (a slam dunk) I can not order an appraisal because we do not have an accepted contract.  And to bring home the point about CW and communication.  AS my borrowers where writing the offer the was a price reduction that had not been returned to the listing agent.  I will make it even better......... BOTH AGENTS ARE IN THE SAME OFFICE. 

Kerry - I believe it.  There are several factors going on here that would cause this.  In my opinion they are:

1.  Lenders are overwhelmed with paperwork.  I understand that the loan resolution departments are often in a  boiler room type of atmosphere with faxes churning out tons of paper and inadequate filing systems.  Hence the reason the tend not to find your paperwork.

2.  Incompetent employees.  I have been fortunate to encounter a few good people, the majority couldn't find their way out of a paper bag.

3.  No single decision-maker.  Some banks assign a person to the file and that person pretty much runs the show.  Other banks let you deal with whomever picks up the phone.  Oh boy!

 

Kerry you bring up some good points about what could happen if these things were to occur. Most banks have multiple people working on these kind of deals because banks are too afraid of making the wrong decision in these types of markets.

Similar thing happened to a borrower of mine.  FC'd property was listed at $347K my borrower offered $339K plus 3% closing cost.  Bank countered and wouldnt budge from the the $347K.  My borrower walked.  The realtor called me 2 weeks later wanting to know if my borrower was still interested because the bank reduced the sales price to $319K!!!!!

These lenders need to sell these home using the "common sense" approach not the CMA approach.

Thats my 2 cents

Charles, The Palm Springs Mortgage Guy