Why isn't countrywide foreclosing?

Asked by Donna, Santa Rosa, CA Mon Apr 20, 2009

We had 4 short sale offers.1st 3 they took so long we lost the buyers, last one they turned down even though the offer was for more than the exact same model sold for a few months ago. We haven't paid in 8 months, why are they dragging this out? So they can try to collect more missed payments? Since they refused the short-sale(which they requested we do), I wish they would just get it over with already and foreclose, what gives?

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Lynn Bowen, Agent, Sebastopol, CA
Tue Apr 21, 2009
Donna, I feel your frustration. You are probably feeling like the bank is pouring salt straight on your wounds by not starting the foreclosure action. Limboland never feels good. I recommend you seek out a Realtor who is very familiar with distressed properties for assistance. We have a team of Certified Distressed Property Experts in our office (yes, they went thru specific training on the subject) that would be happy to assist you with your situation. There are many questions needing to be asked and answered and they certainly would know the right ones to ask and get answered.

If you are interested in their help feel free to contact me and I'll get you in contact with them.

And on a side note, my husband told me this weekend about someone who had quit paying their mortgage about a year ago and has still not heard from them looking for their money.

Lynn Bowen
Domaine Real Estate
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Susan Bryer, , 95472
Mon Apr 20, 2009
Hi Donna,
We've been reading about lenders simply not moving to take properties back, especially in the most distressed areas of the nation. This prompted me to dig out and read carefully the note recorded against my own personal residence - and sure enough the language is very clear that the lender "may" initiate foreclosure proceedings in case of borrower default, but by no means "must" the lender initiate such proceedings! Here's an interesting web article from a bankruptcy attorney in Kansas City:


Truly, bank behavior belies logic in these times. There are so many factors at play in their decisions (or, conversely, their indecision) at this time - most of us players, whether we be the borrowers, Realtors, or mortgage brokers - are small pawns on a much larger game board. I truly wish you the best in this really rocky scenario for you --

Susan Bryer
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Mike Kelly A…, Agent, Santa Rosa, CA
Mon Apr 20, 2009
Donna, Are you aware of the agreement between Countrywide and Bank of America with the Attorney General of California? It was struck a couple days after all the TARP money was funded to help all those ailing assets out there! It in particular addressed the "option-ARM" loans which many consumers grabbed because of the ultra low payments. They are notorious for "Negative Amortization" and big re-sets! You can google this agreement. But one of the promises with the AG was that Countrywide would make every effort to get these modified and allow you to stay in your home. These mofidications would allow 90% loan to value of PRESENT value. Perhaps they have been stalling to show the AG they are acting in "good faith" by giving you time but not really modifying your loan!
We expect a big wave of foreclosures to happen in the next 30-60 days. Have they filed a NOD or Notice of Default on your property? When that happens you'll have 122 days before your house is sold at the Courthouse steps. Until the NOD is filed you are not officially IN FORCLOSURE!! Have they made ANY movement in reducing your loan amount to effect a sale?
Since you have not made any payments in 8 months you at least are in a savings plan so when you do have to move you'll have money to do so. If they have NOT filed the NOD then cool your jets and relax and save your former house payments for a new move. Once it's filed you'll have over 4 months to get out.
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Shar Rundio, Agent, Mesa, AZ
Mon Apr 20, 2009
Donna, there was a federal moratorium in place until the 1st of April meaning that many of the banks had halted the foreclosure process for a time being. On several of my short sale listings the foreclosure date kept getting postponed by 30 days at a time. I'm sorry to hear about your situation and the denial of your short sale. Are you working with an experienced short sale agent? I'd encourage you to continue working to find an acceptable offer.

With Your Success in Mind,

Shar Rundio
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