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Your Personal Short Sale Experiences

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Real Estate Agent with Realty Executives

Okay fellow agents out there, I am just curious to see what your personal experience with short sales has been? 

  • Have they been successful?
  • What banks have been good to work with?
  • Which banks will look at your work out package and give you a "pre-approved" list price?
  • What banks have been horrible?
  • What banks pay you the full or reduced commission?
  • How long did it take for you to get a response, yea or ney, back from the bank?
  • What about properties where the owner owned more than one property but wasn't necessarily an "investor"?
  • What hardships were accepted? Which ones were not?
  • Any special nightmare stories?
  • Any special success stories?
  • What about working with buyers on the short sale end?

An agent in my office was just telling about how great EMC has been for her to work with on her short sale.  I personally am working with Citibank and ASC who neither one will accept our work out package without an offer.  Another agent in our company got a short sale through in 30 days - unbelieveable! 

Thanks for taking a minute to share your experiences!! 

Posted by

Susan Manning

Comments(33)

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Susan Manning
Realty Executives - Temecula, CA

If it sounds too good to be true it usually is!! 

Sep 30, 2008 07:32 AM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

To Short Sale Negotiator:

I've done plenty of short sales but have hit a brick wall with Citi Mortgage on the second loan.  Bank of America will give them $3k (typical).  Citi Mortage agreed to the $3k in January with first buyer who eventually walked (sound familiar).  We now have second buyer - solid gold.  But now it's in Citi Recovery Dept and they have ZERO inerest in negotiations.  They say "we want $10k, we don't care what the other people at Citi said in January".  They absolutely don't care if it goes to foreclosure as they have insurance to cover more than what they would get from the short sale deal.  Helping the seller? be damned......

Jun 19, 2009 12:29 PM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

Hi Andrea,

This is the second mortgagee and if I dink around with sales price, the first mortgagee will start from ground zero again.  My complaint was that Citi Mortgage originally agreed to take the $3k in January, but now want $10K.

Likely between buyer and I - we'll come up with something to appease Citi Mortgage - a company that has taken $100 billion dollars of our money in bailout.

Jun 21, 2009 02:10 AM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

In Northern California, Wachovia is the gold standard for working through short sales quickly.  They have a manager of the territory.  She will meet seller and agent at the property to determine condition and to talk about the hardship - and am told has authority to make a decision on the spot re approving the sale.

 

Anna signature

Jun 21, 2009 02:13 AM
Susan Manning
Realty Executives - Temecula, CA

Anna, I've dealth with the Citi Recovery Dept too.  They are not fun.  It when a homeowner gets to a certain point in being behind on their mortgage.  If you're in the middle of a short sale, usually loss mit will tell you that its going to recovery in X amount of days.  Usually the seller can make a nominal payment to keep the file from going into recovery which is a good thing.  I was told that the recovery dept is like a collection agency.  I'm sure they get paid on how much they get from the short sale.  The biggest trick is getting the First Lienholder to understand and cooperate.  Many times if the first has an investor they can only go by the investor guidelines and then that's when the short sale falls apart. Too bad.  I hope it works out for you!! 

Andrea, those are great ideas but don't forget that the first lienholder has to approve the HUD and if they see that the second lienholder is getting more than the $3K they can get, they won't approve the sale. 

Jun 21, 2009 09:42 AM
Joseph Alfe
Short Sale Processing Inc. - Chicago, IL

OK, some of you aren't getting something important:  Citi may not own the money anymore on the second.  A few months ago they might have, but after a certain amount of delinquency, they sold it to another investor (at a discount)  Citi may still service the second, but they may not be calling the shots anymore.  This is why they suddenly want more money, because the new investor is demanding it, and they are making a power play to get it.  To read more on the inner workings of lenders and short sales, please visit www.short_sale_expert.activerain.com

Jun 21, 2009 02:46 PM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

Joseph,

It actually makes even less sense now.  Well, actually all of it makes sense except the part that the investor paid money to buy the loan at a discount and won't get anything if it forecloses - or is that where their insurance kicks in - and why they act like they absolutely don't care?

I see the words "power play" and I shake my head.  These are peoples lives and Citi (investor) wants to show what hot shots they are?

 

Jun 22, 2009 03:13 AM
Joseph Alfe
Short Sale Processing Inc. - Chicago, IL

Anna,

It is a myth that the second will not get anything in a foreclosure.  They probably have insurance that will pay a percent of loss.  If that loss coverage equalls 10K, then they will demand it from the short sale.  If they don't get it, they will drive the first to foreclose, then collect the 10K from their insurance, then they will obtain a deficiency judgement from the seller to recover the rest.

www.short_sale_expert.activerain.com

Jun 22, 2009 04:16 AM
Susan Manning
Realty Executives - Temecula, CA

Anna, its hard not to take short sales personally, but you have to look at it from the business perspective too.  It a loan is going to a "recovery" department it is because the homeowner has not paid their mortgage for a very long time and they are refusing to make some sort of payment to keep that from happening.  In business its all about risks and payoffs.  By saying they are making a "power play" you are feeding into the emotionalism that this is something personal.  And as an agent, you put yourself up for a lot of heart ache and head aches!!  You have to be the professional and not get caught up in the emotion. 

Jun 23, 2009 10:00 AM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

Joseph,

It definitely makes sense now - that once it goes to Collections it's a different profit center and a whole new ball game.

Susan - I usually can remain calm and professional.  This one specific person just knew which hot button to push to get a rise out of me.  I am once again calm.

I hope we can read more real life short sale stories.  The more information out there, the more we can learn from them.

Jun 23, 2009 12:10 PM
Susan Manning
Realty Executives - Temecula, CA

Ann, even if this one doesn't work out, I'm sure you are going to do GREAT working short sales because you do sound TENACIOUS!!  Go get 'em Tiger!!

Jun 23, 2009 12:18 PM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

Hi Stephan,

Actually Citi has been pretty good.  Just got another approval from them.  It's when it goes to

Citi Recovery, that you end up negotiating (not!) with people that have no soul.  And no, I won't

take that back.

Dec 17, 2009 11:26 AM
Anna Boyd
Re/Max Gold - El Dorado Hills, CA
CDPE, El Dorado Sacramento

The one we closed recently took a little over 30 days to get approval.  Of course, Citi, was the only lender - and our offer was strong - at market value.  They only lost a few thousand on the deal.

Don't know if the above facts play in to it.  Anna

Feb 05, 2010 02:48 AM
Susan Manning
Realty Executives - Temecula, CA

George, I am really sorry to hear that the listing agent "forgot" to submit the offer.  That's a little scarey.  The agent is responsible for staying on top of the process unless they are having someone else handle the negotiation.  That's a red flag in itself. 

Hopefully you love the property and then the agents do their job. Maybe you could request an email in writing from the listing agent that your agent could forward to you with a weekly update at the very minimum.  I do that for all my offers and even back up offers too.  Its important for all sides to communicate throughout the whole process.  If the buyer finds another property, its only fair to let the listing agent know right away. 

You may want to ask your agent if they know whether or not the listing agent is presenting other offers to the bank? That's a question I ask to prequalify whether or not I even show a listing.  If the listing agent is treating the short sale like an auction they are working for the bank and their own personal interests not the seller and buyer.  Honestly I feel those deals are a waste of time. 

I wish you luck in your home search.  Its a very competitive market right now and if you have a June 1 deadline its going to be important you are working with a professional who can get the job done for you.   

Feb 05, 2010 07:26 AM
Susan Manning
Realty Executives - Temecula, CA

Ryan, I would suggest making sure your agent requests a copy of the executed purchase agreement signed by the sellers for starters. 

If I was your agent I would have some sort of verbage in it that the property was not being "Actively" marketed.  The listing agent could put it into Backup or Contingent but with a guarantee that your offer was the only one being presented to the bank at the time. 

There are other things you can do to make an offer strong when you write it.  If you have a good agent they would know these things. 

I wish you luck with you offer!

Feb 05, 2010 07:35 AM
Susan Manning
Realty Executives - Temecula, CA

Dear Jane, I can tell you that personally I would not want to deal with three lienholders on a short sale.  That is very difficult to say the least. 

I don't understand what the negotiator is saying about wearing out your welcome. Calling and emailing for updates on a regular basis is just a normal part of doing that job.  Usually you can find out general timeframes to expect for each step.  I do say that with the caveat that this can and will and does change without notice without reason.  Because there are so many outside variables involved it is very difficult to predict when an approval will come in. 

My personal advise to you is this: it seems you really like this property for one reason or another.  If you are so close to finding an answer, how hard is it to wait until you know rather than quitting at this point.  Of course I probably would have advised you not to offer on a property that had three liens on it in the first place though but that situation has already come to pass. 

I wish you luck on your process.  It pays to work with an agent who knows the right questions to ask before even going to look at the property and creating this whole emotional and time consuming process to begin. 

Apr 28, 2010 10:51 AM
Susan Manning
Realty Executives - Temecula, CA

Chad, yep, its possible your bank could demand this.  10% does seem steep but each lender and situation is different.  I would say that this increased demand is not your responsibility.  If the buyer wants the house, they or the buyer's lender need to come up with the money if another extension is requested.  Honestly, you are lucky that the lender has extended the short sale approval three or possibly four times.  A lot of banks are trending to proceed through foreclosure if the short sale does not close on time the first go around.  I hope your buyer is qualified!!  I would have your agent request to have the buyer cross qualified with a lender of their choosing before wasting any more time.  This deal may not even go through on the fourth time around!  Best of luck to you Chad!! 

Jun 23, 2011 07:42 AM
Susan Manning
Realty Executives - Temecula, CA

If the loan was approved with the mother and then their trying to "jack you around" then I'd say see ya.  Buh bye, and thanks for wasting our time.  That's a bunch of monkey business. 

Jun 23, 2011 08:12 AM
Joseph Alfe
Short Sale Processing Inc. - Chicago, IL

It is entirely legal for the lender to charge whatever they want, but it is also within your power to negotiate. On my deals, if the buyer is delaying the closing, I make them pay the fees.  This is why I am so picky about buyers and also why I demand that they have their mortgage in place well before we close.

 

www.ssnegotiators.com

Jun 23, 2011 08:59 AM
Susan Manning
Realty Executives - Temecula, CA

Chad, $550 is still a lot of money.  How is your transaction going today?  I'm hoping the best for all involved!

Jun 27, 2011 11:33 AM