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Angela Mcintyre's Blog

By Angela Mcintyre | Agent in Alameda, CA

How to work with Washington Mutual on a short sale

I'm representing the Buyer.

We made an offer on a home in the City of Alameda on 4/23/09.  The seller accepted the offer.

Since then, nothing has happened. Washington Mutual, the lender (no seconds) has given us very little feedback, and vague requests --  which we have tried to decipher.  In between our offer date and now, there have been vacations by the asset manager, reassignments of the asset managers, leaves, plagues of locust, et al. 

Finally , today, 7/15/09, almost 3 months late, we  get info that the BPO the lender received,  is way higher than the price the Buyer offered.

After 3 months of delays, we are no way closer getting an offer accepted. 

By the way, the current asset manager sent us an e-mail recently, after we mentioned to him that my clients were anxious to get on with this transaction and that they were VA qualified by a local mortgage broker, and that they were ready to close.  He says in his e-mail:

"Unfortunately no. You are in the same boat with all of the other files we have.

Management knew some deals would be lost, but the transition will have to take place. I will contact you when I know more".

Thank You
Keith JonesLoan Workout Specialist Home Loans

Does anyone know how to get through this type of do-do?

Comments

By Pacita Dimacali,  Wed Jul 15 2009, 22:27
You can try to challenge the BPO. Since many BPO specialists work out of their areas of expertise, they may go by recent sales, square footage, radius or proximity to subject property.

Not too long ago, the listing agent of a fixer short sale was aghast when the BPO came up to $600K on a bungalow she listed at $399K.. That BPO price would have been fair, if the property were in good and habitable condition, which it was not. As it was, the contractor estimates were $260K to bring repair, renovate and bring the property to code..

So she challenged the BPO, provided copies of estimates to fix, asked the loss mitigator to have the BPO person go into the property with her so that he can see for himself how bad a shape this property is. End result: the BPO was changed to be more in line with the market.

This is not unusual. I've done it myself on a listing I had in Oakland.

Engage the listing agent and present your own findings and justification for the lower price. You've waited three months --- it may be worth it to invest a little time providing really good comps for the property. Can't hurt!

And keep looking!

Good luck.
By Kirk Knight - REALTOR,  Sat Jul 18 2009, 21:21
Pacita,
Your comment and suggestions are good ideas IF THE LENDER WANTS TO SELL THE PROPERTY.

WaMu seems to be one of those lenders with no motivation to close short sales. WaMu was acquired by JP Morgan Chase. JPM/C just declared a quarterly profit. But JPM/C quarterly report projects writedowns of 18-24% on WaMu loans.

In my experience, the WaMu loans in the Bay Area are closer to 50% loss.

If JPM/C had sold some of their non-performing assets, in other words, a home with $700K note now selling for under $400K net to bank, JPM/C would have to take a writedown on the asset. By not selling the asset, JPM/C doesn't take the loss, the balance sheet looks profitable, and management gets their bonuses.

The other facts which have been reported to me by numerous WaMu loss mitigation staff over the past year are that they are understaffed, lack computer systems and document management process investments, and frankly ignored by JPM/C management. There is no excuse for this in a company that just paid billions in bonuses. I have had four negotiators quit in the middle of short sale transactions, necessitating a total restart of the short sale process.

My advice to any buyer or real estate agent is AVOID WAMU SHORT SALE PROPERTIES. I have too much evidence that WaMu is not behaving in good faith to complete short sale transactions in a timely manner.


If I've made an error my understanding of current banking and tax law, you work for JP Morgan Chase or WaMu, or your opinion and experience is different from mine, I invite any reader to contact me. Call me at 510-390-0840.
 
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