Replies to This Discussion

Permalink Reply by Mark Raatz on October 13, 2010 at 8:37am

http://blog.foreclosures.com/is-the-fdic-killing-short-sales/
Shared loss agreement, Robin.

Permalink Reply by Dianne Slutsky on October 13, 2010 at 8:53am

Thanks Mark, I read the link and it certainly explains why many banks would rather foreclose. In light of all of the problems currently with the foreclosures - why is this not gaining more publicity? I have several Chase loans that are demanding at least 20% more in price than the value of the property and the banks simply will not allow the short sale to move forward with market value offers.

Permalink Reply by Sherrilee Denton on October 13, 2010 at 9:35am

Maybe your local news station would want to hear about this? If we don't bring information to the attention of the media how well they be able to get the word out on how the banks are really dealing with short sales and what agents and homeowner's are up against? Just a thought.

Permalink Reply by Karyl Moore on October 13, 2010 at 12:55pm

Robin, I've wondered the same thing. Submitted offer for $250,000. Chase countered at $315K (hah!). Buyers came up to $275K (market value). Chase came down to $290K (still way too high). Stand-off for weeks. Chase would not budge. Buyer finally gave up. I sent comps 3 different times. What's odd, tho, is after all this, the negotiator said the Sellers qualify for HAFA and he sent them the forms for that -so now we're going that way. Hopefully a new BPO/appraisal will solve the pricing problem.

Re: that blog about IndyMac - I've had better luck and friendlier negotiators at IndyMac than I have at Chase.

Permalink Reply by Jennie Blackburn on October 14, 2010 at 4:09am

You know what? I have the same thing with a 1/1.5 condo in a 55+ Florida community. It's with Wells Fargo and the amount is lower, but the investor is Fannie Mae. I was nice to the negotiator, I was logical, provided comps and step-by-step explanation as to why the investor would never net $38k on this unit. Never. Ever.

Yeah, okay, I know, why get so worked up for so little profit in my pocket? I just. Can't. Help it. I'm a salesman to the core, which means I never let go. I never give up. I never lose hope.

That didn't work, so I escalated the tone of my emails, trying to give the negotiator every opportunity to do the right thing and keep the proverbial egg off her face. I asked to contest the BPO. No. I asked for the comps used in the BPO. No. I asked to escalate. She closed the file. It was only after I sent an email with this verbiage that I got a response:

I just wanted to be sure I gave you every opportunity to handle this at your level, as I have gotten a completely different policy/procedure from within Wells Fargo. You're sure this is your final answer and that I can quote you, either in or outside Wells Fargo?

I immediately got a call and email from a Wells Fargo supervisor. He had the same answers as the negotiator. At that point, I was so mad and frustrated at the stupidity of the situation that I burst into tears. Apparently, there's no crying in Short Sales and it had no effect. I was on the phone to Fannie Mae while composing a final email to the supervisor:

Thanks for the phone call, Chris. I am so glad you told me the call was being recorded, because I would like a copy of the recording.

Unfortunately, your explanation (It’s FNMA’s fault; we’re just following orders) was little more than a CYA and your “solution” (to have the buyer pay an additional $3-500 for an appraisal) makes no sense. Have the buyer pay for an appraisal? “He’s gonna have to get one anyway,” you said. Really? On a cash transaction? Only lenders require appraisals. The property is worth $37,000 at best, and there is no such thing as a mortgage for that amount. Not to mention that there is No Financing For Condos in Florida (another of the many reasons condo values have radically dropped). But you think the buyer should pay for an appraisal anyway? On the strength of what? The sales contract? The sales contract signed by the buyer and seller is conditional, based on the bank’s approval of the offer, so there is no contract. What fool would pay for an appraisal without the protection of a binding contract? Apparently not the fool trying to buy this property. Your parting shot, that I should put it back on the market until I find a buyer who WILL pay $3-500 for an appraisal on a condo that a seller cannot legally agree to sell is preposterous, for all the reasons I’ve outlined above. If I do as you suggest, this condo will MOST DEFINITELY end up as an REO, netting FNMA significantly less than the $27,000 it could net by accepting the offer we have presented.

A couple of days later, I get an email from a completely new person at Wells Fargo, introducing herself as our negotiator and asking for updated paperwork. I don't know if it was my emails or Fannie Mae, but we are starting all over again. The BPO was done yesterday and came in at $35k. And guess what...I found out the previous BPO came in at $40k. Wait. What? How was Fannie Mae supposed to net $38k with a sales price of $40k? My theory has been tested over and over and proved true: Everybody Works Their Pay Plan. So, is this just stupidity? Bureaucracy? Or is someone at Wells Fargo making more money on properties that become REOs? Its almost as if someone is getting paid under the table to make sure these Short Sales go awry. Show me the pay plan and I'll show you the answer.

My recommendation is to ask if you can quote them. Ask if that's their final answer. Let them know that, individually, they will be held responsible for their decisions and that you intend to make those remarks known, corporate- and nationwide. With the foreclosure halts, individual worker bees are being deposed and asked to account for their decisions. They are being outed! Their answers are in the local paper, online, on air and in the Financial Times and Wall Street Journal.

Jennie Blackburn
Tampa Bay, Florida

Permalink Reply by joe beauchamp on October 19, 2010 at 4:17am

I usually am stuck with the BofA equator short sales - my experience has been absolutely that CMA's mean totally nothing to them. All agents are liars, so far as they (and probably most banks) are concerned). What is a bit of a surprise is that they do react to an accredited appraisal. Probably because the appraiser is legally bound to it.

So far as high BPO's go, I process SS's all day - no real estate sales, etc. I think 20 - 25% of the time the BPO's are bad. And I have had some outlandish ones. Yours being high isn't all that special, I hate to say. So, that could well be the case.

Karyl Moore said:

Robin, I've wondered the same thing. Submitted offer for $250,000. Chase countered at $315K (hah!). Buyers came up to $275K (market value). Chase came down to $290K (still way too high). Stand-off for weeks. Chase would not budge. Buyer finally gave up. I sent comps 3 different times. What's odd, tho, is after all this, the negotiator said the Sellers qualify for HAFA and he sent them the forms for that -so now we're going that way. Hopefully a new BPO/appraisal will solve the pricing problem.

Re: that blog about IndyMac - I've had better luck and friendlier negotiators at IndyMac than I have at Chase.