Short Sale Hell
I have been trying to buy a short sale in Flordia for ten months now. I have no more idea today where we are in this process than I did in March when I made the offer. My agent is a nice guy but all he ever tells me is there is no new information or it is moving as expected. The seller is also an agent and it appears she is handling more of the processes but I have no contact with her. I cannot imagine how this has taken this long and appears that it will continue to drag out even more. I believe there is a comapnay called Short Trac involved and her mortage is with Coldwell Banker, same place she works. Am I crazy thinking this is ridiculous or is this just to be expected. I probably am not supposed to be on this forum but I am desperate for some advise. Should I hire an attorney or am I just stuck in this sort sale purgatory.
Thank you,
Pam Mingo Sain
Replies to This Discussion
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Permalink Reply by Ann Wilkins on
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Hi Pam, If you really love the house and it is still there (not foreclosed and sold to someone else) then be patient. I currently am representing a buyer where her offer was accepted on April 4 so we have just finished up 9 months. Two loans with Bank of America. I work in the same office as the listing agent so I am kept up to date but..nothing that I can really do to help other than be responsive. We thought that we had an approval coming back in Oct. but they moved the loan to another servicer and we started over on Nov 1. Everything had to be re-input into Equator. Over Christmas holiday had an urgent request for a "wet"signature on the price increase addendum that we did in Sept...when B of A allowed Docusign/Electronic signatures. B of A no longer allows electronic signatures. If they didn't receive the wet signature on this one piece of paper, they were closing the file. We scrambled and got it done even though everyone was out of town. Waiting now and hoping to get an approval shortly. Patience is the key.
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Permalink Reply by Gab on
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Pam, I feel your pain. I'm in FL as well buyers and so far we are at 8 months in (Chase 1st and 2nd Liens).
We love the house and that's the only reason we haven't given up.
Thanks to this Forum I've been asking precise questions to the seller's agent so I know more or less were we are in the process.
Our contract long expired but we just signed an extension until January 31st (bank's negotiator asked for it).
One of the reason its taking so long is because they "lost" the negotiator in August so they had to re-start from scratch.
Then we were supposed to receive written approval before Christmas and after calling and calling she informed me that there is now a NEW negotiator working on the file.
Don't know if I should be worried or not everything was supposed to be approved.
Hopefully we will close on this house one day.
Hang in there!
PS: we need to open a Short Sale buyers support group :)
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Permalink Reply by Pam Mingo on
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Hope things work out for you. This is a crazy process. This last extension runs out on the 16th and I am torn.
Pam
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We haven't signed any contract extention (no one asked us to) during the process until last week where negotiator asked for one. Don't know if it's a requirement or not. We are dealing directly with seller's agent and she doesn't seem to worry about it.
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Yes a valid contract is your best friend. Someone will be more than happy to use that as an excuse if they want to do you wrong. Suppose a better offer comes in? Your contract is no longer valid and you dont have much defense especially if it has been lapsed for some time.
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Hi Pam,
Something sounds fishy?? Find out if there is PMI insurance on the loan? Also you can look at public records to see if there is a sale date or go to Realty Trac (free for 7 days). If there is, your deal will probably be foreclosed on especially if there is PMI insurance. The bank will collect the difference from the insurance. The bank does not notify the listing agent or owner of a sale date. Its just scheduled in the county records and bank automatically will foreclose. I am a default advocate and see this all the time!
In Florida we use a 45 day Short Sale Addendum. After 45 days you have a right to cancel the contract.For your protection,In the future it would be advisable to use a Realtor that has not listed the property. Let the Realtor follow up with the listing agent so they can keep you informed.Please reply if you find that there is a sale date. This forum would be interested to hear from you! Thanks for posting!!
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My last extension is up on the 16th so not sure if I should just walk at this point. I really do want this property. It is a small vacation property that will require very little up keep for us as we are in Atlanta. Did not realize or even think about the PMI. I understand the seller is a competent agent so why would she even bother to try a short sale if she has PMI and knows this is what the bank will eventually do? I do look at Realty Trac and the county web page to see if it has forclosed. Not sure there is any other way to know that? Thanks for the response!
Pam
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I'm really confused and YES we do need a "Short Sale Buyers' Support Group." I too live in Florida and made an offer on a short sale May 1st for $40K. On Oct. 30th the realtor told me the bank wanted $47K, which I agreed to. The seller of the house had two loans: one with Citi Financial and the FL Credit Union. I realize this complicates things, but it's now Jan. 6th and we still haven't gotten an approval letter. I'm prequalifed by two banks for $50K and I've been very patient. What I don't understand here, is I'm reading on this forum that the bank can forclose on this house without me knowing it? I have to subscribe to RealtyTrac to find out if it's going into forclosure?? I do know the seller has an attorney involved and the realtor must go thru them to find out anything. Any advice for me?
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You dont have to subscribe if you can learn to use the court house. Id suspect most FL courthouses are automated and available online. Check the buyers name or the property address through the clerks or collectors offices. That will give you the info you will need to check. You can find mortgages etc. Reading the cases will allow you to see if there is an order of foreclosure signed listing a public sale date. That may or may not be known by the realtors or their representatives.
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Hi Susan,
Here are a few questions for thought:
Does the loan have PMI insurance on it? If so its very likely to go to foreclosure. Why you say? Strictly a banks business decision. Think like a bank. Would you loan someone on a home of say $100,000 and know you are not getting paid. The home is know worth 1/2 or $50,000 in this market. Why would you sell at $50,000 when you have insurance to pay you back $100,000. Folks, this is not rock science. Common sense says, offer a short sale, prolong it as long as possible, keep everyone involved ie. RE Brokers, seller and buyers waiting and keeping them busy with paperwork knowing that an auction date will be field. Tell no one of what you are doing and then pull the plug. No one knows whats happening until an REO agent starts knocking on the owners door!!
The Attorney, listing agent,home owner and everyone involved is kept in the dark. It much easier doing this because without knowledge there is no power in stopping the auction!! And believe it or not this is legal since its posted in the county clerks records only being public record which no one looks at!!
If you have further questions email me at [email protected]
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The basic problems in a short sale are realtors and the third party the lender. Realtors are in business. The third party is in a different business and entirely in control of the situation. The buyers agent is essentially powerless. The sellers agent is at the mercy of the lender. You have to have some sympathy in dealing with two professionals with jobs to do who are at the mercy of a third party who has volume to do with.
You will help yourself of you can understand what financial issues are in play. How many mortgages for how much? It can get tricky.
My big complaints about short sales are speed obviously and lack of communication. Most likely the sellers realtor is not negotiating with the lender until far along in the process if at all. But the sellers realtor should be getting updates weekly as a matter of courtesy. You can drive your agent crazy but you cant force anyone to cooperate with them. Theres far too much foot dragging at the lender level. When they get the offer the appraisals should be done. If your offer is not in line with what they want/accept why drag you along for months?
I read a comment about back up offers. Read your contract. I have a FL agent who after executing a contract that said no back up offers to be solicited solicited a back up offer. Thats the other side of realtor ethics and they are out there.
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