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Working With Two Banks on A Short Sale???

Real Estate Agent with Prudential California Realty
We all know that Short Sales are very tough to do because of the time it takes to get an approval from the bank. Dealing with one lienholder can save a whole lot of time and stress because there is only one lien against the property, but when dealing with more than one lienholder can make things a little rough. I am currently working on several Short Sales that are in contract and being reviewed by the bank. We are about two weeks away from closing and I have currently ran into a small obstacle with the negotatior of the junior lienholder's bank. I have received senior approval on the first from the primary lienholder and they have notified me to inform the junior lienholder to release the lien and that they will pay them 5,000 dollars out of their proceeds, as a credit to release the lien. I have called the junior lienholders and notifies them of this and the negotiator comes back to me and says that in order for them to accept to release the lien, they would have to receive an additional 3,500 dollars from my clients! Now, isnt the whole reason for doing a Short Sale becasue the client is in a hardship and cant afford to make any more payments on the home? I do not understand what these banks are thinking. I strongly believe that the banks have put themselves in the position they're in to where they are taking enormous losses and attaining a large inventory of REO properties where they have to pay inventory fees, maintenance fees, and all of the other fees they have to pay that are associated with managing the property through the REO Process. If any other agents viewing this have run into this same problem, please leave your comments and if you have any advice as to how to get past this problem, it would be highly appreciated. Thank You for viewing!
The Dave Ruwe Homes Team
Re/Max Lakeshore - Grand Haven, MI

Good luck. I have been going through a nightmare dealing with only one bank. I can't imagine dealing with two.


May 19, 2008 11:06 AM
Pam Winterbauer
Pam Winterbauer Real Estate - San Ramon, CA
"Providing Blue Ribbon Service"

Usually they settle on 1% of the initial amount of a minimum of $1000 to close the escrow.  This may be their point of negotiation.   Good luck.

May 20, 2008 02:42 AM
Sherri Aragon Realtor

I am dealing with the same thing. The offer was for full price of $99,000 and accepted. Appraisal cam back as $83,500. Trying to see if bank will accept the appraised value. 1st bank has acxcepted 2nd hasn't. The 2nd bank want's $1500 more from someone. The listing agent and I agreed to split the cost $750 ea. from our commission and the 2nd bank won't accept the money from the listing agents commission. Something about they don't want to pay her a commission and then get it back from her. What can be done about this or possabliy what can happen?

Don't understand the banks.

Nov 07, 2008 12:09 AM

I am in the process of going through a short sale, my home, and there are two lein holders, chase and countrywide.  we finally got an acceptance from countrywide, verbal only, and chase cancelled my short sale becuse they didn't get documents from countrywide in time!  Do they ever re-open files?

Jan 10, 2009 02:14 AM
Cameron Novak
The Homefinding Center - 1000 Palms, CA
Real Estate Broker since 2008

Dealing with seconds on Short Sales is definitely a time magnet.  I spend 4 times as much time on the phone with loss mitigation on short sale seconds, as opposed to the time I spend on short sale first mortgages.

Cameron Novak

Jan 10, 2009 06:56 PM
Cameron Novak
The Homefinding Center - 1000 Palms, CA
Real Estate Broker since 2008

P.S.  What's up with the FreeMason logo?

Jan 10, 2009 06:56 PM