Replies to This Discussion

Permalink Reply by Ben Benita on August 8, 2010 at 6:10am

Call them and ask if they have mortgage insurance on the note.

If yes, find out who with, and, ask what the coverage ratio is (this will help you calculate at what point it makes sense for them just to foreclose).

If they refuse to tell you, have your Seller send in a "QWR", (banking speak for qualifed written request, or, any request sent in by the homeowner that is signed and dated) asking who the MI company is and how to contact them.

I would also do this to find out who the Ivnestor is on the note, and, STRONGLY suggest you escalate your file ASAP to supervisors and highers ups.....

Permalink Reply by Patti Berube on August 9, 2010 at 12:35pm

Hi George, have you had any luck on your end? I have this same situation. I've talked with CitiFinancial & they've said they charged it off. But I have this Debt Collection agency AIC Corp that is telling me I need 10% as well. BofA is saying $3,000 - and I put $750 of my own commission in, but I haven't gotten anyone there to tell me if it's going to be enough or not? I have my BofA SS approval letter, but I'm worried this 2nd is going to mess up the whole deal?

Permalink Reply by George P on August 10, 2010 at 2:32am

I'll know for sure by Monday, we have given both BOA and Citi that date as the final deadline to approve or decline this sale, with our contract terminating if no response is received. It's crazy, after 8 months of waiting it will come down to the wire. I did contact a Citi executive and explained the whole situation, he responded right away and said he would have a 2nd review done. I didn't ask him if the loan was charged off/insured.

On the BOA side, the seller's realtor ordered an appraisal, hoping to show them that our offer is above market price and it's the absolute best they will ever get on this property (which is true, since we offered a fair price in January and have watched the market further deteriorate over the past 8 months).

And that's it. I am leaving it up to the banks. If they decline, I'm out 8 months of my time, about 500 bucks from the inspections, and the 8k tax credit. I'd imagine BOA will foreclose soon, Notice of default was sent in January and the house has been abandoned for over a year. If I don't find another property before then I may look into buying it via sheriff's auction.

Permalink Reply by Ben Benita on August 10, 2010 at 2:50am

I would STRONGLY suggest contating the foreclosure attorney or sheriff and asking them what the home will go for at auction.......9 times out of 10 it is MUCH LESS than what they will take via short sale.....

We always tell the Buyer's agents we negotiate for to find this out as early as possible

Permalink Reply by Candace Robinson on August 11, 2010 at 12:35am

George & Patti -

I'm representing the buyer, we made an offer on a property with 1st being BoA and 2nd with Citi. After four months, we received our written approval for the 1st Friday. The 2nd had been waiting and had verbally approved the terms. Now that we are seeking the 2nd written approval from Citi, they changed their minds. Two factors happened, the time frame it took to get the deal approved by the 1st caused the 2nd lien holder demand for a file review. Upon reviewing it, they had charged-off the 2nd and had the LA deal with that company (unknown of the that name) and they made demanded complete different terms. The 1st lien holder agreed to pay 3K to the 2nd, the collection co. said 'nope' we want an additional $4500.00 from seller. The listing agent forced his way to someone above the negotiator for the collection company and finally worked it down to $2,000.00 in which, the seller (home-owner) agreed to pay half. My buyer is not in position to pay anymore, so between the lender & myself we are going to pick up the difference. This is the second deal we have made it to this far in the transaction and the 2nd has laid havoc for my buyer. The first time, it came to a stand still and they wouldn't budge off of $2500.00 (which that seller refused to pay).

It seems totally ridiculous that these 2nd lien holders can tie up these transactions and hold them for ransom!! They would lose huge if this property were to go to foreclosure!!

Disappointing. Happy Selling!!

Candace

Permalink Reply by Ben Benita on August 11, 2010 at 1:14am

Candace -- at least you hung in there and it got done. I run a negotiations company and we have a Buyer "pre-offer" questionnairre we ALWAYS suggest any Buyer's agent use prior to even bothering to make an offer, things like:

how many liens are on the property (has it been verified), who is handling the negotiations (if the listing agent, how many short sales has he/she closed), giving your Seller a heads up on this stuff will GREATLY reduce headaches for you.....contact me at [email protected] if you want to see a copy.

These are some questions you should ALWAYS have answered before you make an offer on a short sale.

We also STRONGLY suggest use of a pre-listing questionnairre before taking any short sale listings. Same thing here, if there are LARGE medical or contractor liens, if the Seller flat out refuses to close if there are prom. notes or deficiency possibilities, etc, might be a good idea to pass on teh listing.....NOTHING worse than working hard on a short sale and finding out last minute your Seller will not close, or, that there are 3rd and 4th lien positions that need to be paid......ask me how I learned this.....

:-)

All my best to everyone.

Permalink Reply by Patti Berube on August 11, 2010 at 4:34am

Hi Candace, this is SOOOO frustrating I know! The 2nd's are getting wise to the fact that we as realtors are trying to make a living & know that they're standing in the way of putting the whole deal together for buyer/seller/bank & them!
My new listing guidelines for future short sale listings will be to only handle the one's where the first & second are with the same bank and/or there is just one loan & refer the rest to others! We work too hard on these to get down to the end & have to cobble money together!

Candace Robinson said:

George & Patti -

I'm representing the buyer, we made an offer on a property with 1st being BoA and 2nd with Citi. After four months, we received our written approval for the 1st Friday. The 2nd had been waiting and had verbally approved the terms. Now that we are seeking the 2nd written approval from Citi, they changed their minds. Two factors happened, the time frame it took to get the deal approved by the 1st caused the 2nd lien holder demand for a file review. Upon reviewing it, they had charged-off the 2nd and had the LA deal with that company (unknown of the that name) and they made demanded complete different terms. The 1st lien holder agreed to pay 3K to the 2nd, the collection co. said 'nope' we want an additional $4500.00 from seller. The listing agent forced his way to someone above the negotiator for the collection company and finally worked it down to $2,000.00 in which, the seller (home-owner) agreed to pay half. My buyer is not in position to pay anymore, so between the lender & myself we are going to pick up the difference. This is the second deal we have made it to this far in the transaction and the 2nd has laid havoc for my buyer. The first time, it came to a stand still and they wouldn't budge off of $2500.00 (which that seller refused to pay).

It seems totally ridiculous that these 2nd lien holders can tie up these transactions and hold them for ransom!! They would lose huge if this property were to go to foreclosure!!

Disappointing. Happy Selling!!

Candace

Permalink Reply by Cheri Smith on September 29, 2010 at 9:44am

Candace, how did you get BOA to agree to let Citi receive more than the 3k max? With my short sale, Wells Fargo is the 1st and Citi is the 2nd. Wells agreed to give Citi $3000 but Citi is demanding $5000. The buyer agreed to contribute $1000 and the seller will contribute $1000 but Wells said if the HUD shows Citi receiving more than $3000 they will deny the short sale.



Candace Robinson said:

George & Patti -

I'm representing the buyer, we made an offer on a property with 1st being BoA and 2nd with Citi. After four months, we received our written approval for the 1st Friday. The 2nd had been waiting and had verbally approved the terms. Now that we are seeking the 2nd written approval from Citi, they changed their minds. Two factors happened, the time frame it took to get the deal approved by the 1st caused the 2nd lien holder demand for a file review. Upon reviewing it, they had charged-off the 2nd and had the LA deal with that company (unknown of the that name) and they made demanded complete different terms. The 1st lien holder agreed to pay 3K to the 2nd, the collection co. said 'nope' we want an additional $4500.00 from seller. The listing agent forced his way to someone above the negotiator for the collection company and finally worked it down to $2,000.00 in which, the seller (home-owner) agreed to pay half. My buyer is not in position to pay anymore, so between the lender & myself we are going to pick up the difference. This is the second deal we have made it to this far in the transaction and the 2nd has laid havoc for my buyer. The first time, it came to a stand still and they wouldn't budge off of $2500.00 (which that seller refused to pay).

It seems totally ridiculous that these 2nd lien holders can tie up these transactions and hold them for ransom!! They would lose huge if this property were to go to foreclosure!!

Disappointing. Happy Selling!!

Candace

Permalink Reply by Candace Robinson on September 29, 2010 at 2:54pm

Cheri -

The second had been charged off and so it was the collection agency that was demanding more. Somehow the lender, title company had it worked out on the HUD to get the approval everyone needed. I would suggest talking to the lender and see what can be done. I believe the listing agent paid the amount the collection agency demanded, that had to be paid upfront, then it was worked out on the HUD.

Good luck.