SS process once the property is entered into WF equator system

4.5 months ago my husband and I submitted an offer on a home listed as a short sale property. It was quickly accepted by the seller (on Oct 6th, 2012). About a week later on Oct 12th we got an email from the sellers agent and attorney that "the offer is in the hands of an agent at WF".

We had been patiently waiting, as we have been told short sales can take months, until a week ago when we found out that the house has a foreclosure auction date set for March 7th!

Anyway, yesterday (Feb 21st) the sellers attorney forwarded an email from the lender, more specifically a Loan Adjustment Specialist (I'll call her LAS) at Wells Fargo (both liens are held by WF). The letter dated Monday Feb 18, 2013 stated that the LAS had initiated the short sale in equator and that the attorney should be able to see the file once the WF Rep has connected the attorney to the file. That the atorney would be "contacted in roughly 4-7 business days by either an HAFA Rep or WF Rep whoever is helping with the file". That the LAS was doing her best to get the file to a negotiator within a timely manner. And, finally that the LAS has "requested to postpone the foreclosure date out 30 days from the sale date. No guarantees of course but we should be able to get it postponed."

UGH!!!! We had been lead to believe but the sellers agent (never done a short sale before) that the BPO had been ordered and completed back at the beginning of Jan. We thought we were just waiting to hear from a bank negotiator but now it seems the house wasn't even an actual short sale yet, at least not as far as the bank was concerned.

Suddenly, I am questioning everything....how can we be sure that WF has our offer? Why is there no mention of that in the letter from the LAS?

How does the process work once the property is input into equator? Our agent says that is really the beginning of the process. Is it possible that the BPO was ordered and done before the property was input into equator?

From your experience what happens now???

Thanks!

We want this house. We intend on rehabing it into our forever house and we are prepared to wait...and wait.

Thanks for any advice or feedback.

Britt

Hi Britt,

Short sales are often good buys because they come with an "aggravation discount." Who'd put up with a short sale if they weren't a good deal?

I've represented both buyers and sellers in short sale transactions, and I know how frustrating they are for both sides. My advice is to decide how long you are willing to wait for the sellers, their agent, and Wells Fargo to work out the sale. Most contracts specify a time that you've agreed to wait.

Until then, it may be less stressful not to try to follow all the twists and turns that make short sales look like a season of "Lost." Let your agent stay in touch with the seller's agent and update you on major developments. If you can, try to carry on your life without thinking about the short sale on a daily basis. Otherwise, it is going to seem like the proverbial watched pot that never boils.

It is hard to see behind the behind the curtain to the seller side. The listing agent and bank have a client and customer relationship with the seller which includes requirements of confidentiality.

Even a short sale that is actually moving ahead may seem a little chaotic because you're getting most of the information third hand. It also may seem chaotic because short sales can be chaotic. Even the best listing agent must deal with servicing banks and investors that reverse their decisions, provide contradictory information, and behave capriciously.

Once you've reach the time you are willing to wait, have your agent give you a detailed update. Decide, based on that information, whether you're willing to wait longer or find another home. Listen carefully to your agent's advice.

I've had short sales as a buyer agent that had an approval letter in less than a week (some other buyer had plowed the ground ahead of us) and listings that got cleared to close in less than a month. On the other hand, others that successfully closed took almost nine months.

Usually I'd suggest asking your buyer agent if the listing agent has closed a lot of short sales. However, it sounds like the listing agent is a rookie. See how much confidence your agent has in their counterpart on the other side. Lack of experience could be a problem. However, even a competent rookie can close a short sale particularly if they are part of an experienced team, or have strong support and training at their brokerage. My first short sale listing was a success, and I'm sure that's true of a lot of other short sale agents.

Otherwise, there is not a lot that you can do to influence the process. Be sure to respond promptly to document requests that the listing agent may forward to you through your agent. Having your agent touch base with the listing agent every week or so may be useful. Buyer agent calling the listing agent every other day is not helpful.

As far as the specific situation that you described--if you do want to try see behind the curtain--it sounds like there is a lot of movement and activity at Wells Fargo that may represent progress. You've also gotten a lot of detail from the other side which suggests that they want to keep you up to date even though the result appears to be a ball of confusion. The worst situation is an unresponsive listing agent who keeps you totally in the dark.

Many short sales are concluded under the threat of foreclosure. However, some properties do fall into foreclosure even after seller has received an approval letter.

I don't see how a BPO would have been ordered and completed unless the short sale was underway. The short sale bank is spending money on the BPO or appraisal and wouldn't do that without a reason. The listing agent represents the interests of the seller, but you hope that the seller's agent will uphold their obligation to deal honestly with others who aren't clients.

Equator is a communication tool provided by a vendor. Banks use Equator as they wish. It is not an automated system that adjudicates the short sale. Some short sales must be initiated on Equator. I've seen other situations where an Equator file can't be open until the short sale bank tells you to upload data into Equator.

The short sale is an emotional roller coaster for the buyer. It is probably best to stay as detached and businesslike as you can. Stay in touch with your agent who should help guide you. If the short sale goes through then you'll probably have a good deal. If not, be ready to shrug and move on to the next property.

Good luck to you! I hope my commentary was a little helpful to you. I extend best wishes for a smoother process and a successful closing.

Replies

Wayne Brooks February 24, 2013 at 6:19am

You have heard essentially correct, the initiating into Equator, Is the beginning of the short sale process. Although, if it was submitted it for HAFA review, and this what they've "been doing" for the last 4 months, HAFA Review is done outside of Equator with Wells. This is an extremely long period to just now be initiating. It doesn't sound like the attorney's office is really on the ball either, as the file is generally iniated from "our side" not the bank's side. You might want to keep track of the court/trustee sale date status by checking the court files yourself. Some places you can do this online.
William "Andy" Alford February 24, 2013 at 4:39am

Hi Britt,

Short sales are often good buys because they come with an "aggravation discount." Who'd put up with a short sale if they weren't a good deal?

I've represented both buyers and sellers in short sale transactions, and I know how frustrating they are for both sides. My advice is to decide how long you are willing to wait for the sellers, their agent, and Wells Fargo to work out the sale. Most contracts specify a time that you've agreed to wait.

Until then, it may be less stressful not to try to follow all the twists and turns that make short sales look like a season of "Lost." Let your agent stay in touch with the seller's agent and update you on major developments. If you can, try to carry on your life without thinking about the short sale on a daily basis. Otherwise, it is going to seem like the proverbial watched pot that never boils.

It is hard to see behind the behind the curtain to the seller side. The listing agent and bank have a client and customer relationship with the seller which includes requirements of confidentiality.

Even a short sale that is actually moving ahead may seem a little chaotic because you're getting most of the information third hand. It also may seem chaotic because short sales can be chaotic. Even the best listing agent must deal with servicing banks and investors that reverse their decisions, provide contradictory information, and behave capriciously.

Once you've reach the time you are willing to wait, have your agent give you a detailed update. Decide, based on that information, whether you're willing to wait longer or find another home. Listen carefully to your agent's advice.

I've had short sales as a buyer agent that had an approval letter in less than a week (some other buyer had plowed the ground ahead of us) and listings that got cleared to close in less than a month. On the other hand, others that successfully closed took almost nine months.

Usually I'd suggest asking your buyer agent if the listing agent has closed a lot of short sales. However, it sounds like the listing agent is a rookie. See how much confidence your agent has in their counterpart on the other side. Lack of experience could be a problem. However, even a competent rookie can close a short sale particularly if they are part of an experienced team, or have strong support and training at their brokerage. My first short sale listing was a success, and I'm sure that's true of a lot of other short sale agents.

Otherwise, there is not a lot that you can do to influence the process. Be sure to respond promptly to document requests that the listing agent may forward to you through your agent. Having your agent touch base with the listing agent every week or so may be useful. Buyer agent calling the listing agent every other day is not helpful.

As far as the specific situation that you described--if you do want to try see behind the curtain--it sounds like there is a lot of movement and activity at Wells Fargo that may represent progress. You've also gotten a lot of detail from the other side which suggests that they want to keep you up to date even though the result appears to be a ball of confusion. The worst situation is an unresponsive listing agent who keeps you totally in the dark.

Many short sales are concluded under the threat of foreclosure. However, some properties do fall into foreclosure even after seller has received an approval letter.

I don't see how a BPO would have been ordered and completed unless the short sale was underway. The short sale bank is spending money on the BPO or appraisal and wouldn't do that without a reason. The listing agent represents the interests of the seller, but you hope that the seller's agent will uphold their obligation to deal honestly with others who aren't clients.

Equator is a communication tool provided by a vendor. Banks use Equator as they wish. It is not an automated system that adjudicates the short sale. Some short sales must be initiated on Equator. I've seen other situations where an Equator file can't be open until the short sale bank tells you to upload data into Equator.

The short sale is an emotional roller coaster for the buyer. It is probably best to stay as detached and businesslike as you can. Stay in touch with your agent who should help guide you. If the short sale goes through then you'll probably have a good deal. If not, be ready to shrug and move on to the next property.

Good luck to you! I hope my commentary was a little helpful to you. I extend best wishes for a smoother process and a successful closing.
Marti Sauers February 24, 2013 at 3:27am

Hi Brit. While I'm sure many of us would love to help you, you are working with an agent, and we can't really provide advice to you. It would be a code of ethics issue. I would ask your agent to post any questions they might have.

All the best!

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