Ed, that's the first time I've heard the term "business model" used to mean total incompetence. ;-)

Seriously, most of these banks are losing thousands of dollars on each transaction because of the way they handle short sales. It's appalling.

I have done about 15 short sales in the last 18 months or so and nothing is similar on any one of them. I have found it to be true that the departments within the banks don't communicate with each other. When is the trustee sale scheduled? Is it before you can close? If so, you may have an issue. I usually hedge myself by having investors who can purchase the home at the trustee sale and if the math works out, sell it to the buyers you have set up in the short sale IF I can't get the bank(s) to put off the short sale. It really is not that suprising that they had their hands out to the feds, their business model is pathetic.

When it comes to banks, who knows. It sounds like the collector might be just trying to improve their stats. I'd check with the short sale people (loss mitigation) at the bank to see what they say.