Foreclosure in Annapolis>Question Details

Britt Grothe…, Home Buyer in

In order to get the short sale moving can we contact the seller directly?

Asked by Britt Grotheet, Fri Feb 15, 2013

We made our offer 4 months ago. It was accepted by the seller and submitted to the lender. The BPO was ordered and done. The listing agent states that the hold up is the seller. Seller not want to deal with bank (Wells Fargo). The house is now listed as a foreclosure with an auction date set for 3 weeks from now. We are at the point where we want to contact the seller directly and ask him if he would give the bank/lender permission to speak to our agent. We just want an opportunity to negotiate for this property before it goes to foreclosure in a few weeks. Anyone ever heard of a seller doing this, giving the lender permission to speak directly to a potential buyer?

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Jessica Hood & Laura Roskelly’s answer
If the seller will not cooperate with the bank there isn't much you can do. It could be that the bank is asking them to contribute money to the sale or sign a promissory note for the negative balance. What an unfortunate situation.

However, I don't see why your agent can't ask the seller's agent to see if the seller will speak with you.
0 votes Thank Flag Link Mon Feb 25, 2013
For a short sale to work it is important that both the seller and their lender are willing to work toward the common good of the transaction. In your case, it certainly appears there is and has been a breakdown in this process. With only three weeks to foreclosure there would need to be an awakening on the part of both parties to bet this done. It's been my experience that at this late date the assistance of a good real estate attorney experienced in distressed sales may be your best shot for success....but the seller would need to advocate for this?

Good luck,

Bill
0 votes Thank Flag Link Sat Feb 23, 2013
Yes a seller can give you permission to talk to his lender directly, but it may not help. If the seller isn't giving the bank what they want, then the banks hands are tied. The bank doesn't own the home, that is why they have to foreclose on it, so they get possession of it. Then you would be able to buy it from the bank.
0 votes Thank Flag Link Fri Feb 22, 2013
Hi Britt, you could try getting another lender.
0 votes Thank Flag Link Fri Feb 22, 2013
A BPO or Appraisal is generally ordered when the Lender receives a ratified contract (subject to 3rd. party approval of course). This is why I would have your agent make sure that the offer HAS been submitted and being negotiated on. I know it is too late now but this is why, when speaking with a lot of distressed homeowners, the importance of working with an experienced listing agent when selling your home by Short Sale. It makes the process very easy for everyone invloved including you...the Buyer!
0 votes Thank Flag Link Fri Feb 22, 2013
Bob- Generally, once a house is put into the equator system, it is then that the short sale process begins and a BPO would be ordered at that time?
Our offer was made 4.5 months ago. Supposedly it was submitted to the bank at that time and about a month after the offer was made we were told the BPO was ordered. About 3 weeks after that we were told it had actually been done.
I don't want to say anything negative about our agent, the sellers agent or the sellers attorney working on this because I am not in their shoes but.....well I will leave it at that...the truth is I feel like I have gotten more valuable feed back from the people on this website than from any of them. And! I have actually been the one to provide them with lots of info. due to my picking up the phone and asking around.
Thanks again-
Britt
0 votes Thank Flag Link Fri Feb 22, 2013
If it is just NOW being put into the Equator System...it is more than likely just beginning as a Short Sale. The negotiator of listing agent would be the one starting this. The BPO was probably for the purposes of obtaining value for the foreclosure itself. The Bank still had to get their "numbers" together for a "Buy-In" price for the auction. Again, I would have your agent communicate with the listing agent to make sure everything is moving forward as a Short Sale.
0 votes Thank Flag Link Fri Feb 22, 2013
Just thought I would update. You all have been so helpful and maybe the thread will help others.
Anyway, the first official notice of the foreclosure auction was posted on Wed 2/20. I had given up hope when....
We get an email link from our agent. It was a link to an email sent to the sellers attorney on Mon Feb 18th from a WF Loan Adjuster Specialist. The letter stated that she had initiated the property as a short sale in their Equator system. It said that once a WF rep had connected the sellers attorney to the file the attorney would be able to see it online. That the attorney would be contacted by a HAFA rep or WF rep who is handling the file in 4-7 business days. That WF would do their best to get the file into the hands of a negotiator in a timely fashion. Finally, WF said she had contacted the foreclosure dept and asked for a postponement of 30 days from the auction date. BUT! That there was no guarantees.
All that was on Mon 2/18 at this point Fri 2/22 house is still being advertised for auction.
Now my question for all those experienced with short sales is...isn't being put into the equator system just the starting point? I am now questioning whether the BPO was ever done? What comes first, being put into the system or the BPO?
0 votes Thank Flag Link Fri Feb 22, 2013
Hello Britt


If the seller signs your agent as part of the authorization form they will be able to communicate with the bank but it sounds like something else is going on. If the BPO was completed, the bank has a valuation of the property to present to the bank and/or investor and you are nearing approval or denial or counter offer of your offer.

It might be a good idea if you all parties sit down if possible and talk.
0 votes Thank Flag Link Thu Feb 21, 2013
The seller can give your buyers agent authority to speak to the bank or banks involved in the short sale by signing the "Credit authorization" forms and submitting them to the banks. When I am a listing agent on a short sale I always provide the buyers agent authorization to be able to follow the progress of the short sale if the buyers agents want to. Doing so just improves communication for all parties involved. The question for you at this point is will the seller SIGN the credit authorizations.

It appears the seller is NO longer submitting the required documentation needed for Wells Fargo to complete the short sale process. The question here is WHY the seller at this late stage of the process had stopped cooperating with the bank. Wells Fargo will likely PAY the seller to move out of the house upon closing, this can run from $3,000 to $20,000. Also the seller can credit recover from a short sale in 3 years, it takes 10 years on a foreclosure.

It it apparent you really want the house, may I suggest all parties get together in a meeting and work out a solution to this sale to STOP the foreclosure date. The foreclosure date can likely be stopped, I have stopped foreclosure sale dates several times.

Greg Myers
RE/MAX Realty Group
0 votes Thank Flag Link Sat Feb 16, 2013
Britt, when performing a short sale, the whole point is that it is sold short. The bank would not be asking the seller for any proceeds from the sale. All commissions and fees are paid for by the bank. If anything, depending on the type of loan the seller has, it is possible for the seller to walk away with money.
What you must understand is that many sellers just simply do not want to deal with the headache of a short sale, or since they are already underwater they are drained from the financial situation, however, with the right people working on the short sale, you can get the foreclosure date pushed back. I know an agent out here in New Jersey that dealt with a woman that had a property about to go to auction in two days...she then called the agent and the agent and the attorney working on the short sale got the date pushed back and finally the home sold as a short sale.
I am wondering whether the listing agent has fully explained to the seller how a short sale vs. a foreclosure will affect the seller. I agree with Robert, it does not sound like experienced individuals are handling this file.
Yes, you can get permission for your agent to speak to the lender through an, "Authorization to Release Information," however, this is not something that will happen right away and usually takes anywhere from 48-72 hours for it to show up on the lenders side. On top of that, you will have to get the seller to agree to this and sign more documents. I would contact your agent and have them speak to the listing agent and as Donna said, have a third party who can expedite the contract.
0 votes Thank Flag Link Fri Feb 15, 2013
Buyers who look into a short sales purchases will find out that this alternative it can be very stressful and tedious. Not only a short sale require buyers and seller to reach an agreement, but the banking institution or mortgage company that holds the mortgage must also approved the transaction. It is very difficult to do something about if the seller does not want to cooperate with the negotiator. Ask permision to the listing agent to go and talk to the seller to see if you can convince him/her to provide all the documents that Wells Fargo is asking for.

Best of Luck,

Maria Cipollone
Century 21 Tenace

http://www.Flahomespecialist.com
0 votes Thank Flag Link Fri Feb 15, 2013
Hi Britt,
The seller could give you permission but the bank probably would not speak with you. There is many a time that they don't even want to speak to the agent. Short sales are very difficult and most buyers become very frustrated and the agents become just as frustrated.If the seller is not cooperating with the bank then you have a problem. Only the seller can furnish all the necessary documents to prove that there is a hardship. The listing agent can assist the seller to expedite matters but if all these things are being done and you are not getting anywhere with the bank, it will be difficult. You could see if the listing agent or seller has contacted someone in authority over the negotiator but the bank is so large that it is difficult to find the right person. I have found that the seller can be helpful if they make the calls and provide the necessary information as quickly as possible.t is difficult because the bank does not care and there is no motivation for them as there would be for a regular seller that wants to sell his home.maybe your agent can convince the listing agent to contact a company to pursue expiditing your contract. Good Luck!
0 votes Thank Flag Link Fri Feb 15, 2013
Hey Robert - Another week has gone by. We poke our agent and presumably he pokes the listing agent for info. He told me this week it looks like it may be foreclosed on. The best we get as to why this would happen and as to why we have heard nothing about our offer is "the seller is non-responsive to
the bank".
We are dying to just contact the seller and ask him to give our agent authority to speak directly to the bank/lender/investor on our behalf. Is anything like that ever done? We are looking for an opening to negotiate with them. Our offer was low, giving us room to move up. If the seller doesn't want to deal with this anymore because the bank wants more $$$ from him... Why can't we step in and cover some of those costs??
As far as the foreclosure goes...I gather best case it could take 4-6mo till it shows up on an REO list. Worst case
10-12 mos.
Britt
0 votes Thank Flag Link Fri Feb 15, 2013
I have to ask you. What is your agent telling you? Is your agent asking the Listing Agent for daily up-dates as to what is happening? The Listing Agent is working on behalf of the Seller to move this Short Sale file forward. Believe me, they do not want this to go to auction HOWEVER...with that said. It MAY work to your benefit. I have heard many times that if the Lender (Investor) buys the property at the court house steps, the lender should take a second look at your offer. Remember, many times the one hand (Foreclosure Department) does not know what the other hand (Short Sale Department) is doing. Your file deserves and NEEDS an experienced Short Sale Negotiator. Basically someone who is working on this file everyday...demanding the Lender move forward on this....asking for a letter of approval, etc.

I would not contact the Seller directly. They are represented by their own agent. You need to work through your agent on this.
0 votes Thank Flag Link Fri Feb 15, 2013
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