BECKY PANASUK,  in Baltimore, MD

Why does it take so long for banks to get back with you about a short sale ? It should be called a long sale.

Asked by BECKY PANASUK, Baltimore, MD Fri Nov 14, 2008

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8
Fernando Her…, Agent, Gaithersburg, MD
Sat Nov 15, 2008
Becky:
Having completed a number of short sales already, I can tell you with certainty that the service providers like "Countrywide" or other banks aren’t the ones making the decision in a short sale. They are just the middle man. . The actual owner of the note is an investor.
Many times before we see a difference in response times from the same bank. .it is just because they are two different investors.
A lot of foreign investors have purchased US real estate securities. .and they are now having to discount most of those loans. . one by one in a short sale
Read my blog about this subject here: http://activerain.com/blogsview/537332/SHORT-SALES-in-MARYLAND
.
1 vote
Chris Highla…, Agent, Frederick, MD
Fri Nov 14, 2008
Becky,

The previous answer is correct! Banks never saw this crisis comming. They do not have the staff or systems in place to handle it. In Maryland the number of short sales that actually go to settlement is much lower than in some other states (FLA,NV,CA) that have led the way over the cliff in the mortgage crisis. The fact is that most of the short sale packages that go to the bank for "approval" are D.O.A. because they fail to provide the necessary info for them to make the decision. For example, the banks need to have proof of the sellers "hardship" in order to recommend to the investor involved that they settle for less than is owed. Sometimes the investor is literally in another country. The dirty little secret is that only the offers that have ALL of the necessary information for ALL of the parties involved your offer will most likely end up in the shredder.
The need for the listing agent to know what they are doing is never more important than in a short sale situation. They are the ones preparing the information for the bank and if they are unaware of what is required the banks do not have the time to specify the items necessary. They are buried with these deals!

Good training is essential within the Realtor community is critical to the public being well served. One such trainning class on short sales that I have attended is the Certifed Distressed Property Expert or CDPE. There are others out there but we all need to get with it if we as agents are going to improve our success ratio with short sales (currently aprox 1 in 30 go to settlement in MD.)
1 vote
Kim Mills, Agent, Crofton, MD
Sat Nov 15, 2008
All of the answers here are correct. It is numerous things that have made the process drag on. I think the lack of knowledge/experience by the listing agent hurts. I can't tell you how many times I talk to an agent to find out that they keep having sellers sign offers and submit them to the lender. They are treating this like an auction and not like a contingency.
Kim
Web Reference:  http://www.kimandrenie.com
0 votes
Mike Benton, , Maryland
Sat Nov 15, 2008
Hello Becky, I'm sure you hear the news about the volume of Short Sales on the market. The key to a short sale is building a relationship with the investor. You must have all paper work completed correctly and into the mortgage company quickly. You must show the investor why the house is only worth your offer, pictures,comps and soforth. Then stay on everyone like a pitbull. If you have questions feel frr to contact me at 410-610-5614.
Thanks
Web Reference:  http://www.mikebenton.net
0 votes
The Diamond…, , 04280
Sat Nov 15, 2008
I just tell people, "this is a short-sale, meaning short amount of money, long period of time"
0 votes
The Hagley G…, Agent, Pleasanton, CA
Fri Nov 14, 2008
A lot of the loss mitigators are working hundreds of files at a time.

Add to that incomplete packages submitted by Realtors, and often inexperience on both sides of the transaction.
0 votes
William Metz…, , Portland, OR
Fri Nov 14, 2008
Drives you nuts, doesn't it?

Most agents in our area shy away from short sales for this reason.
0 votes
Ray Day, , Hermitage, TN
Fri Nov 14, 2008
The answer is actually somewhat scary. They are not really equipped with the infrastructure to handle short sales. Now with the loan modification cases added to their melting pot, it is going to get worse. One major lender has put out that they will be doing a loan mod offer to 500,000 homeowners, and the 600 people they will be hiring and training are supposed to handle that workload. 834 individual loans per person to deal with, and no across the board general software that can do each one.

So now throw your short sale and all of the foreclosures into the mix along with many other factors, and you have a long sale. I hope your buyer and seller can hold out. Unfortunately the quickest I have ever saw was 60 days, and that was some good prep prior to starting with the lender. Maybe they are going a little quicker today, haven't done one in 2 years.
If your seller would like to stay in the house, I suggest looking at a loan mod solution, at least as an option in case the short sale falls through. Loan mods can be done anytime for anyone even after a foreclosure sale.
For more info check out our blog. Also you may want to direct some of your clients you cannot help to a Loan Mod. There is a commission for that too.
Hope this helps answer the question.

http://www.modifymyhousepayment.com/blog
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