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LOCK CHANGES ARE KILLING THE SHORT SALE BUSINESS

By Wendy Rulnick

Real Estate Broker/Owner with Rulnick Realty, Inc.

February 13, 2009 06:55 AM

30-A Short Sale

Since I wrote my last blog post about BANKS CHANGING LOCKS on short sales I have had three more cases of lock changes. Today it was on an $850,000 home in a secure gated subdivision on 30-A in Santa Rosa Beach, FL. In fact, just yesterday we received an offer on the property. The home is currently on a rental program and is regularly and well-maintained. We found out about the lock change when the seller's rental company went to change the air conditioner filters today. There was a note on the door warning that the property had been secured, and NOT to enter. The deadbolt was changed. This time the bank was Countrywide who did the dirty work. Their "property preservation" company would have had to climb over a locked gate to get into the subdivision! My sign was RIGHT THERE! These cowboys didn't bother to call. Nor did they happen to notice the pool fountain was running and the house looked immaculate. San Remo They just CHANGED THE LOCKS.

The number to call they left on the door is just Countrywide's customer service. The non-communicative representative had me on hold for 20 minutes, then told me to call another number. THAT number was just a recording! This has got to STOP! How are we going to help the banks by doing THEIR jobs, selling these properties pre-foreclosure, if they put up road blocks? How many hours do my staff and I have to spend tracking down keys, replacing signs and driving to properties we cannot get in? Not only does it waste our time and money, it COSTS THE BANKS MONEY by paying the property preservation companies for work they SHOULD NOT BE DOING!

Last week I called ASC four days in a row asking for keys to the new lock they changed by GOING PAST MY SIGN! The house, in Navarre Florida, was maintained, power on, lawn mowed. ASC's property preservation department never called me back. SO my seller changed the locks back himself so we can SELL HIS HOUSE.

THANK YOU BANKS!

It's Wendy!

Wendy Rulnick, Broker, CRP, CRS, GRI, ABR Rulnick Realty, Inc.

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Wendy Rulnick specializes in real estate sales, short sales, traditional sales on Emerald Coast of Florida: Destin Florida real estate, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field. Wendy Rulnick, Broker and Realtor, has been selling real estate for 20 years. She has won numerous awards, including the coveted ADDY for advertising design. Wendy lists and sells homes, condos and townhomes in Destin FL and the surrounding areas. She is ranked in the top ½ percent of all Realtors on the Emerald Coast of Florida for resale listings sold and was featured in Kiplinger Personal Finance Magazine as a short sale specialist.

This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

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Roland Woodworth

Benchmark Realty - Clarksville, TN

Benchmark Realty

Wendy: Yes.. that is the correct thing for them to do.. some are just worried about the almighty dollar they will recieve and not worry about the dollors they cost others.

Feb 27, 2009 04:06 PM

Kathleen Rollins - AZ Real Estate

Coldwell Banker Residential Brokerage - Chandler, AZ

Citi changed the locks on mine in Mesa and what a run around ! I called Safeguard who "secured the house" even tho a sign was there and my lockbox. They told me to call Citi, Citi told me to call this other number who ended up being the trustee ? Seriously, we lost our lockbox, and a week of selling time but finally did what most of you are doing. Just change the locks if you get any resistance. It is not their home yet.

BTW ~ I have 2 really pretty ones right now, newer homes... 3115 sqft 5 bedroom for 260k* in Mesa and one in Chandler with a sweet casita for 275k* in a lake community.

Mar 06, 2009 02:55 AM

Wendy Rulnick

Rulnick Realty, Inc. - Destin, FL

"It's Wendy... It's Sold!"

Sidney - Yes I have one now with CW first and BOFA second. No help or giving on CW's firm offer of $3000. BOFA wants $10,000.

Roland - Desperate times... cause desperate actions.

Kathleen - I haven't had this happen for a week, maybe I am overdue!

Mar 06, 2009 04:00 AM

Sidney Jimenez

Keller Williams - Miramar, FL

CDPE, Short Sale Expert, 954-665-9449,

WENDY,

I don't know about you but my experience has been that the first will only contribute up to $3,000 (rarely more than that) That being the case I take the tact of telling the second that they will not receive more from the first and they should know that.

Sometimes the second will relent seeing that the person they're dealing with is knowledgeable with the process. The times they don't I usually try to work a better deal on a Promissory Note with favorable terms.

Knowing the parameters most first lien holders stand with, I will bypass trying to make them move. On the HUD we overestimate the taxes due and some other expenses so that could give you some room at the end if it's a matter or a couple grand.

You know all this already, don't you?

Become a CDPE Today

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Mar 06, 2009 04:53 AM

Wendy Rulnick

Rulnick Realty, Inc. - Destin, FL

"It's Wendy... It's Sold!"

Hi Sidney- Yes we overestimate on taxes and past due HOA.... BOFA "might" be changing their tune a little due to the merger. BOFA rep called back a minute ago and suddenly said "OF COURSE we will honor Countrywide's $3000." This is a 180 from yesterday!! BUT he is calling homeowner directly to micro-analyze his finances. VERY interesting!

Mar 06, 2009 05:02 AM

Sidney Jimenez

Keller Williams - Miramar, FL

CDPE, Short Sale Expert, 954-665-9449,

WENDY,

They might have realized they are dealing with an agent that knows what she's doing. This happened to me with SunTrust recently. They could be calling your client and try to negotiate a Promissory Note with them directly.

Let me know what happens! It will be interesting to see if they are changing tactics again.

Mar 06, 2009 05:15 AM

Wendy Rulnick

Rulnick Realty, Inc. - Destin, FL

"It's Wendy... It's Sold!"

Sidney - After a few days, the BOFA rep never called my sellers to talk about finances. So, I gently called him back- he said it was on his list to do yesterday. Still no call by this morning. So I FAXED him a page with handwritten note in SHARPIE (so it wasn't too formal), saying, "HI First Name, I know you are swamped, but we need to make closing arrangements soon. Is there anything I can do to help? Wendy" ... Well three hours later, approval for 3K was faxed. Done deal! YEA!

Mar 11, 2009 10:57 AM

Sidney Jimenez

Keller Williams - Miramar, FL

CDPE, Short Sale Expert, 954-665-9449,

WENDY,

Great job! I truly believe that your knowledge and their awareness of that knowledge got you the approval under your terms. It's amazing what education and confidence will do.

Mar 11, 2009 12:29 PM

Wendy Rulnick

Rulnick Realty, Inc. - Destin, FL

"It's Wendy... It's Sold!"

Jim - I am glad to hear there are good guys, like you, doing your job properly. I have received call from property preservation reps on occasion after seeing my sign on a home. I agree the others need to leave the business.

On a side note, I was just informed by Saxon Mortgage that they would change the locks, on purpose, every single month and remove our lockbox. When we find out, we are to call and they will mail us a new key. My assistant told them they were wasting a lot of money and they didn't care- said it was their policy.....

Mar 24, 2009 11:13 AM

Melissa Zavala

Broadpoint Properties - Escondido, CA

Broker, Escondido Real Estate, San Diego County

You know. Last year I helped to close over 300 short sales, and actually l only had that happen once or twice. I was enraged, also. But, in my neck of the woods, the lock thing does not happen very muchonly

Apr 03, 2009 02:07 AM

Mark L. Ostrovsky

Howard Hanna Real Estate Services - Beachwood, OH

Howard Hanna Real Estate Services

We submitted an offer to HSBC two months ago, which would have netted them around $10K more, on a $150K house in Ohio, than they would have received from a prior short sale that they approved through another Realtor. The prior deal feel apart when the buyer couldn't perform.

HSBC had everything it needed from us and from the great new buyer we found, including seller's hardship letter, financial documents, appraisal, preliminary HUD-1, ad infinitum. The sellers were a mere $20K to $30K upside down in their mortgage. This would have been a win-win for everybody. The seller no longer occupied the house and had moved away. They however preferred a short sale to foreclosure for credit impact reasons.

We called HSBC weekly for an update and, after several weeks, were told by the loss mitigation person"supposedly" in charge of the file to send a new HUD-1 to reflect a later closing date. This because HSBC allegedly had to get investor approval. She lied. We subsequently learned that this was merely a stall tactic and that HSBC was the investor. The loss mitigation person never returned calls, nor did they give any indication of how things were moving along, etc. It was one stall after another, on and on and on.

Bottom line, HSBC's lawyers filed the foreclosure action and one day we arrived at the house to find that the locks were changed and that a lock box had been installed on the door. The court has not yet even ruled on the foreclosure! Unless I'm mistaken, an interest in a property is not the same as ownership. I can understand HSBC wanting to secure their interest in the property, but both the attorneys involved and the loss mitigation department were aware that we were working on a short sale. The other day, before the lock change, we spoke to someone at loss mitigation and they told us that a new person was in charge of the file and that they had to send another appraiser and another Realtor out for a BPO, since the old one had expired. Is it a coincidence that only several days later that the locks were changed? How are we Realtors supposed to do our job in a climate of deceit and deception where sleazy lenders get bailed out and rewarded for their utter greed and incompetence?

I recently heard some great news that HSBC was heavily invested (all things being relative) with Bernie Maddoff, which is the only good news I have experienced since we got started with this lender. But seriously, does anyone have any thoughts on this or suggestions. Thank you.

Apr 22, 2009 02:40 PM

. .

San Diego, CA

I have dealt with Aurora and First Franklin sending out companies to change the locks. FF had no trepassing signs posted.

We document the incident and have the seller's attorney send a letter.

Jul 19, 2009 11:37 AM

Fernando Herboso - Associate Broker MD, & VA

Maxus Realty Group of Samson Properties - Clarksburg, MD

301-246-0001 Serving Maryland, DC and Northern VA

I had a couple listings that happened to me. . I just call them and a few days later, they send me a copy of the keys. . .both properties were vacant at that time.

Jan 30, 2010 11:32 PM

Bob Willis

Berkshire Hathaway HomeServices California Properties - Orange, CA

Orange County & L.A. County Senior Home Advisor

Since I am new to short sales (I have my first ss listing now), I had never heard of a lender changing locks before foreclosure. This post is enlightening. Thanks to AR members like you who share this information.

Feb 01, 2010 05:50 AM

Ben Benita

Ben Benita - Gainesville, VA

Speaker, Author, Game Changer, Coach

Most lenders are MORONS...we ALWAYS tell our agents and employees to NEVER say a home is vacant...

When asked, simply respond with:

"I am not certain, where do we stand on myh approval letter, my BUyer is getting anxious....."

Loan servicers will get theirs in the next 6 to 12 months...BIG changes are coming from teh ivenstors that are paying these clowns to service notes.....CAN'T WAIT!!!!

Ben Benita, Expert Negotiator, SHort sales and Loan Modifications, www.United-IG.com, 703-754-7551

Feb 17, 2010 04:32 PM

Robert Peronne

Philadelphia Realty Exchange - Philadelphia, PA

Associate Broker

Are the lenders changing locks on occupied properties or only vacant ones? I always tell homeowners that they have to keep the property occupied or they could be in default on the terms of their mortgage. If the property is vacant don't they have the right to secure it?

Mar 31, 2010 05:50 PM

Christine McInerney

Great Life RE - Knoxville, TN

The McInerney Team, Knoxville TN Homes For Sale

I had this happen on my current listing but thankfully they only changed the back lock and left the front lock with keybox in place.

Jan 10, 2011 07:53 AM

Inna Ivchenko

Equity Union - Calabasas, CA

REALTOR® | Residential & Commercial

I just had such situation today. I came to show the house: no lock. The bank 'thingy' was stoled 2 times this month. Today, again.... it was nothing on the door. I pushed and pulled all doors and found one( what a surprise:( opened- &broken. The property is vacant. Two realtors with their clients arrived in a few mins. We got an accepted offer, but...how many more times the lock will be stolen till the end of the escrow?

Feb 20, 2012 04:15 PM

Jim McNinch

Trademark Loss Mitigation - Spring, TX

Short Sale Specialist, Texas

I'am also seeing this more and more. They even go as far as cutting off our lockbox. I have gone ahead and gotten a locksmith to put the old locks back on!

Jul 12, 2012 05:51 AM

Wendy Rulnick

Rulnick Realty, Inc. - Destin, FL

"It's Wendy... It's Sold!"

Jim - At least they are now calling in advance... I just had one call me when I didn't have a sign... I was shocked.

Jul 14, 2012 01:25 AM