Some Lenders Need to Buy a Clue

Managing Real Estate Broker with eXp Realty RB-19250

I have watched lenders one by one drop like flies over the last few months.  I see commercials telling consumers in trouble to contact their lender, because they want to help them.  I honestly do not believe it.  Have you ever tried to contact a lender for a short sale packet or to discuss not being able to make the payments and the need for some relief?  Fortunately I have not been in that situation, but know several folks who have.  They all have a consistent story.  The lender would not take their call.

I personally have avoided doing short sales as much as possible.  Dealing with the delays and the non-sense from the lenders just does not seem like it is worth the trouble.  Buyers I work with so far have not tried to buy one. (thank goodness)

Currently I am working on a REO sale.  The bank took the home back through foreclosure and has it listed with a real estate agent.  She is a very good agent in my area that I know.  We put in an offer and got a verbal acceptance.  It has been over 3 weeks and we still do not have documents back from the seller (bank).  While waiting to get this in escrow the interest rates have gone up a little.  (Bad for the buyer.)

As time passes the buyer's excitement about this property is being replaced with doubt. If rates climb again it may be replaced with moving on. 

When we put in the offer, we were told we could get a response in as fast as 24 hours.  They must be using the metric system.  If this takes much longer, the lender will be looking for another buyer.

So if these lenders are so overwhelmed with so many properties to deal with, would it not make sense to expedite the ones they can and get them out of the way?  Wouldn't logic say that they are losing even more money by their incompetence and lack of urgency?

How many more folks out there feel the same as I do?  If I had my choice I would avoid dealing with the lender controlled sales.  With them creating that negative environment they are causing even bigger loses.  Over the last year, I have read many articles and blog posts about this problem, yet if anything the lenders have gotten worse.  I guess they simply do not care.

Posted by



Randy L. Prothero, REALTOR®

Broker-in-Charge, ABR, AHWD, CRB, CRS, e-PRO, GRI, MRP, SFR

eXp Realty

Team Leader - "The Prothero Group"

Randy Prothero is well established as an expert in working with military / VA clients and first time home buyers.  His home seller's (listing) campaign is one of the most aggressive marketing programs in the area.  His luxury home listings sell faster and for more money.

Based out of Mililani, Hawaii. Randy services the island of Oahu (Honolulu County) Performs mediations and ombudsman services for the Board of Realtors.  To improve overall professionalism in his area Randy also offers classes for real estate agents. 

www.HawaiiRandy.comOahu (Honolulu County) Property Search  Hawaii Military Relocations


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Stephen Kappre
KW Hometown - Mantua, NJ
Helping You Home

Randy - Same story around here - at least fom my experience.  But you know some realtors use this as their primary niche now and are successful.  So whatever floats your boat.  No doubt it is a headache.  I've had banks call my buyers back about their offer 3 months later, AFTER they settled on something else!

Oct 03, 2008 02:58 PM #1
Susan Templeton
Bellingham, WA

Acutally, if the borrower is behind on payments but has an ability to make good via a loan modification it is preferable to the lender than taking expensive legal action to foreclose. There is a good non profit group that offers assistance: Hope Now My experience with REO's is once it's gotten that far there are no human beings involved!!!!

Oct 03, 2008 03:03 PM #2
Jason Sardi
Auto & Home & Life Insurance throughout North Carolina - Charlotte, NC
Your Agent for Life

Randy - The mentality of Lending Instituitions is an odd thing these days, no doubt.  The loss mitigation departments of any of these institutions need to be more educated about the process. Though, I will say that it seems to be more about an hourly wage paid to somebody who doesn't much give a damn about anything other than a wage 'earned'.  In this particular cycle, there is a lot to learn.  Folks on all sides of this industry were and are ill-prepared on what was to be and is the reality of what is going on right now.  Ignorance isn't always bliss...

Oct 03, 2008 03:05 PM #3
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Steve - That is beyond ridiculous.

Loanletter - Why do they waste all those commercials telling troubled consumers to call their lender, if they won't answer the phone?

Jason - I see it as a simple matter of poor management.  I spent many years in management and if my company was losing money, we would do whatever we could to minimize the lose.  These lenders are violating almost every business principal know to man.

Oct 03, 2008 03:11 PM #4
Georgie Hunter R(S) 58089
Hawai'i Life Real Estate Brokers - Haiku, HI
Maui Real Estate sales and lifestyle info

I hear you loud and clear.  And now all this new legislation just makes we want to avoid them altogether.

Oct 03, 2008 04:59 PM #5
Katerina Gasset
Get It Done For Me Virtual Services - Wellington, FL
Get It Done For Me Virtual Services

Randy- You know Nestor and I niche in short sales. It is frustrating but the reward of saving homeowners from foreclosure and getting the most awesome thanks and testimonials ever are more than worth the headaches. We created a system and we have gotten to know many of the bank managers and negotiators. We know how to get it done. We offer our clients a great service since we have not lost one deal yet this year. We close our short sales. But we also don't take no for an answer from the lenders.

The more we know about the process, the more we learn about bank ratios, nets, and inner workings, the more empowered we are to make things work. You must treat those answering the phones and the negotiators as if they are third graders. Jason is right, the front lines only care about their paycheck at the end of the day. This is the frustrating part but if you know that you can use that to your advantage.

This is a great time for agents with great negotiating and communication skills to shine. If you make it through this, you can make it through anything. Katerina

Oct 03, 2008 05:52 PM #6
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate

Randy, that is the same scenerio I have encountered both on the selling side and my buyer agents. It is also I question I see posted on Trulia quite often. The buyers get tired of waiting, no matter how much we prep them for the wait. If the buyer has the patience they will get done, but they take time.

Oct 03, 2008 11:03 PM #7
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Georgina - I think it will be hard to avoid them, but many of us feel that way.

Katerina - In this case I am representing the buyer and have no communication with the seller. 

Early in the year I put in an offer on a short sale.  After 6 or 7 weeks we had no answer on our offer and the home was stripped by the home owner of appliances and fixtures.  We withdrew our offer and moved on.

Missy - In this case we were told that because it was an REO, we could get an answer within 24 hours.  We offered more than asking price and 3 weeks later still no contract.

If it takes that long to get a response what will escrow be like.  My client needs to give notice where he lives and is losing money as his mortgage rate has gone up.  Not much opportunity to plan his life.  At this point I can find him another property without the hassle.

Oct 04, 2008 06:06 AM #8
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Randy, I just closed on a loan that was a short sale on Thursday.  It took the Attorney for the Buyer and the Realtors on both sides three days to get the Banks Attorney to return phone calls so that we could get payout figures from them and set up a time for the closing.  Mind you that they approved the short sale almost two weeks ago and the rate lock was going to expire on Friday.  It is a frustrating process right up until the end.

Oct 04, 2008 02:16 PM #9
Jim Frimmer
HomeSmart Realty West - San Diego, CA
Realtor & CDPE, Mission Valley specialist

Or they could just buy a vowel. I would suggest I:

  • I will get this done today.
  • I will call you at about 10:00 tomorrow.
  • I will email you this evening around 7:00.
  • Have your Client call me and I will help him.


Such a powerful letter. Such a powerful word.

Oct 04, 2008 10:25 PM #10
James Wexler - Scottsdale, AZ

Banks have such a backlog of evaluating short sales here in AZ, that it makes sense to not even make offers on short sales, or list short sales - only deal with REO

Oct 05, 2008 04:22 AM #11
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

George - I just can't buy that it needs to be that difficult.

Jim - I have gotten such promises to have them never honored.

James - The one I am having the delays on is an REO.

Oct 05, 2008 01:15 PM #12
Gena Riede
Riede Real Estate, Lic. 01310792 - Sacramento, CA
Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

Randy, I hear you. I have been dealing with the same thing all year. It's very defeating for the buyer and definitely takes the "wow" factor out of real estate. I am appalled at the inadequacy of the banks. I got the bank executed contract 1 week before closing on one of my deals and now I am waiting for the bank to sign the docs that we signed last Friday...who knows when they will get around to it.

I wish there was something or someone that we could contact about this and turn it around. I have blogged and video tapped about this until I'm blue in the face and yet it continues...

I wish you and your buyer the best of luck...patience is all I can possibly recommend.

Oct 07, 2008 03:38 PM #13
Randy Prothero
eXp Realty - Mililani, HI
Hawaii REALTOR, (808) 384-5645

Gena - I have been fortunate to not have to deal with many of these so far.

Oct 07, 2008 07:36 PM #14
"Dee-Jay" Hayes

I worked short sales successfully for seller clients with several different lenders during the last short sale cycle here on Oahu and have found myself once again involved in it.  In fact, during the previous cycle one local bank's Senior Vice President called to ask me if I'd consider teaching the short sale process to members of the bank's staff in the Mortgage Workout Department.  You see, after calling for an appointment, I hand delivered my client's (and my) short sale application package directly to him.  He was duly impressed with the package and with my persistence on meeting him personally to deliver it.  I found that one key to getting a timely short sale response is get to as high up the ladder toward the top level of lender management as possible as soon as possible.  You don't have to skip over the "worker bees" to do this ... just arm yourself with some info about the real crew chief(s) early on in the process in case you need to use it.  It's not impossible to deal with the boss even from a distance.  Example:  I'm currently working a short sale application with Wells Fargo Bank, N.A..  It took me two calls to get the direct fax number and phone number of the folks who review the submitted short sale application packages.  Last Friday I faxed a 54-page short sale application package to them (Note: Sometimes mail gets stacked up unopened for days because these folks are pretty busy right now!).  At the same time I googled "president of wells fargo bank" and found out that John G. Stumpf is the current COO of Wells Fargo and I learned about his management background (handy if I have to call him).  I'll call the "worker bees" this Friday, meaning they'll have had a week to look at the package I sent, and ask what progress is being made.  If the answer doesn't suit me, I'll tell them I'm faxing the same package to Mr. Stumpf ... and, if it becomes necessary, I will indeed do just.  Often I get asked to hold and then the Division Manager comes on the line to help me out!  In this case, if I had to use some top-down leverage, first I'd call Mr. Stumpf to let him know I'd like to continue promoting Wells Fargo as a lender to my buyer clients, but I can no longer do so in good faith because of the lack of attention being paid to one of my client's short sale packages which I'll be faxing directly to him.  I've been successful with short sales, especially whenever I've used my "get the big guy's attention" approach to the approval process.

Dwight "Dee-Jay" Hayes, Ph.D., Realtor®, President & Principal Broker, Veterans Realty Inc., Mililani, HI

Oct 15, 2008 01:00 PM #15
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Randy Prothero

Hawaii REALTOR, (808) 384-5645
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