Replies to This Discussion

Permalink Reply by Sherrilee Denton on July 14, 2010 at 10:08am

Same thing happening to me with Wells Fargo Alisa. Representing buyer under contract for 90 days and recently heard from List agent that 2nd tier negotiator will not submit the file to investors because seller is not 60 days past due. Seller was making payments up till June and missed June payment! Seller was told by lender prior to doing short sale that he did not have to be delinquent to be considered! Not so 90 days later and file is now at a stand still until 60 day delinquency arrives.

Permalink Reply by Bob Wienk on July 14, 2010 at 10:11am

That's interesting. BofA also does this. But check the attached new rules from HUD dated 12/16/09, which clearly indicates a seller should keep payments current if they plan to apply for another FHA loan after their short sale.

Attachments:

• New FHA rules on buying after a short sale.pdf, 50 KB

Permalink Reply by Alisa Martin Pepper on July 14, 2010 at 12:21pm

Hi Sherrilee & Bob,
Thanks for sharing. It is definitely frustrating that we are told that they will do a short sale without being delinquent and then they just don't work the file. I got someone helpful today that says there is a Eminent Default Department that may work the file. We shall see. Our seller is really trying hard to preserve their credit as best as they can. I'm just not sure the short sale will happen without being 60 days delinquent. I welcome any other advise.

Permalink Reply by Ben Benita on July 15, 2010 at 2:36am

TO ALL,

It is TOTAL BS that they require late payments.

THE ONLY REASON SERVICERS (who your client writes his/her check to each month) DO THAT IS BECAUSE THEY MAKE MORE MONEY SERVICING NON-PERFORMING NOTES (where Sellers are late)!!!!

This BS sure gets irritating.......
Servicerrs are paid by the Investor to "service" notes, handle escrows, send statemetns, harass clients when payments are late, etc. Typically, servicing fees collected when payments are on time -- 1/4 point annually.

Want to know how much Servicers like Chase, B of A, etc., make servicing "non-performing" notes (when payments are late)
1/2 point annually....yep, they make TWICE AS MUCH CASHOLA WHEN YOUR CLIENT IS LATE. If your client starts missing payments, the Servicer, Chase in this case, makes twice as much money.....

Want to call them out on it, try these 2 responses:

1) "Really, my Seller needs to be late.....THAT IS AWESOME!!! So you Mr. Negotiator are telling me my Seller can quit paying you guys, and, live in the home FOR FREE while I complete this short sale.....________(Seller) is going to be so happy..."
Then SHUT UP and watch how they squirm and try to respond.....this works for ALL short sale negotiations....get your negotiator OFF of the script he is reading to you from and you OWN HIM!!!!

or, try this:
2) "....so you are telling me the Investor on this requires my client to RUIN his/her credit before they will help.....send me that in writing so I can show the attorney we are working with and we will inform the Seller......"
Then again, SHUT UP and listen to them squirm.

Guys, push back....Git R' Done!!!!!!

Permalink Reply by Kyle Souza on July 28, 2010 at 8:59am

Ben, what about Freddie's written HAFA guidelines that state 60 days late and something ridiculous like no more than $250 in liquid assets?

Ben Benita said:

TO ALL,

It is TOTAL BS that they require late payments.

THE ONLY REASON SERVICERS (who your client writes his/her check to each month) DO THAT IS BECAUSE THEY MAKE MORE MONEY SERVICING NON-PERFORMING NOTES (where Sellers are late)!!!!

This BS sure gets irritating.......
Servicerrs are paid by the Investor to "service" notes, handle escrows, send statemetns, harass clients when payments are late, etc. Typically, servicing fees collected when payments are on time -- 1/4 point annually.

Want to know how much Servicers like Chase, B of A, etc., make servicing "non-performing" notes (when payments are late)
1/2 point annually....yep, they make TWICE AS MUCH CASHOLA WHEN YOUR CLIENT IS LATE. If your client starts missing payments, the Servicer, Chase in this case, makes twice as much money.....

Want to call them out on it, try these 2 responses:

1) "Really, my Seller needs to be late.....THAT IS AWESOME!!! So you Mr. Negotiator are telling me my Seller can quit paying you guys, and, live in the home FOR FREE while I complete this short sale.....________(Seller) is going to be so happy..."
Then SHUT UP and watch how they squirm and try to respond.....this works for ALL short sale negotiations....get your negotiator OFF of the script he is reading to you from and you OWN HIM!!!!

or, try this:
2) "....so you are telling me the Investor on this requires my client to RUIN his/her credit before they will help.....send me that in writing so I can show the attorney we are working with and we will inform the Seller......"
Then again, SHUT UP and listen to them squirm.

Guys, push back....Git R' Done!!!!!!

Permalink Reply by Alisa Martin Pepper on July 28, 2010 at 10:10am

After much persistence and a call the the Executive Complaint Office, the file is now being worked. They ordered and completed 2 BPO's and a processor is reviewing the file. I am told we will have a negotiator any day here, but you know how that goes. Stay tuned.

Alisa

Permalink Reply by Ben Benita on July 28, 2010 at 12:19pm

Kyle -- Sellers have the option to opt out of HAFA at any time....find out who the Investor is on the note, and, have the Servicer send you written guidleiens where it shows in writing payments must be missed to do a traditional short sale (I have NEVER seen it REQUIRED other than for HAFA)

keep in mind, Servicers get paid EXTRA CAHSOLA for approving HAFA short sales....that is why they push for, and automatically put you into, the HAFA program.

Sometimes HAFA makes sense (Sellers can get cash at closing, BUT, may be asked to make payments during hte process), and other times HAFA is a total waste (mostly when a second lien is invovled that is owed big money).

My 2 cents on making payments -- if the Seller is having trouble making payments (using credit cards, borrowing money to keep up, etc.) they should stop wasting their money as it is ONLY keeping their credit score up.....they might as well write their check out directly to Experian or one of the other credit agencies....I also ask them:

"In 6 months, you can have a great credit score, but, be out $6000 (assuming your mortage payment is $1000/month),
or,
you can have a lower credit score (you will be dinged anyway from the short sale), but, have $6000 in the bank.....which would you prefer?"

I write about this often in other blogs......

Permalink Reply by Kyle Souza on July 28, 2010 at 12:54pm

Thanks for the response Ben. HAFA seems to be a load and it's funny how BAC puts investment property through the program just to get the "incentive" for trying.

Permalink Reply by Ben Benita on July 28, 2010 at 1:30pm

EVERYONE HATES B OF A......can not blame you one bit,


HOWEVER, from a business stand point, they are kicking _____, last quarter was one of their best ever......just makes me SICK thinking they are cashing in on this market......