What is an escalation request?

Asked by Christy, Butler, NJ Tue Oct 5, 2010

We've been waiting a few months now for news about our short sale. We were told that the realtor put in an escalation request and that the bank agreed/accepted. Does this mean that they could get to our file soon? I'm not familiar with this term.

Help the community by answering this question:

+ web reference
Web reference:

Answers

5
Lyle Wolf, Agent, Morristown, NJ
Wed Oct 6, 2010
Christy
Escalation in Short Sales usually refers to escalating the file (when necessary) to someone higher up in the lender’s organization who can and will take appropriate action. Typically this will be done if the Loss Mitigator appears to be unreasonable in the face of the facts of the situation or not responsive and dragging the process out much too long. It must be done tactfully and diplomatically, and best escalated to the CFO, CEO, SVP, etc. You must present a good case that what you want in the Short Sale is also in the best interests of the lender and that is very clear in the facts of the file. A successful escalation results in a quick approval of the Short Sale.
0 votes
J, Agent, Greensboro, NC
Wed Oct 6, 2010
Do you mean "escalation clause" added to the documentation? Or, do you mean a request to "escalate the file" while in process with the bank? I am not SFR certified but have been working through short sale options since 2006 and have many years banking experience with contracts, addendums and clauses related to distressed residential and commerical real estate deals.

Agents use the phrase "escalate my file," verbally to loss mitigators in an effort to push a file forward and get a response faster. In most cases a bank will move a file along rather quickly if it is 1-2 weeks before a foreclosure sale date has been scheduled. Unfortunately, many loss mitigators may not begin processing a short sale package due to the back-log of short sale deals on their desks until this timeline.

I hope your deal is successful and all goes well.
0 votes
Mary Petti, Agent, Edison, NJ
Wed Oct 6, 2010
Kind of curious why your Realtor didn't ask the question of the sellers agent as to what they meant by the term.
I too am SFR certified, and done several short sales, and have never seen/heard this term used before.
I suggest you ask your realtor to get to the bottom of this, just in case you or your realtor didn't get the term quite right. On the otherhand, intuitively, it sounds like you may be right and they are trying to move the case along.

I am assuming that your offer was not yet accepted by the bank, because once the contract is approved as a short sale by the bank, they typically give the buyer 45 days from acceptance to close. I would also have your realtor find out (if you don't already know ) if the bank had a BPO (broker price opinion) already performed, This is the first step in approving a short sale contract offer. It determines the house's fair market value for the bank so they can evaluate your offer and decide if your offer is good enough not to have too much of a "short" fall in proceeds at closing.
0 votes
Jeanne Feeni…, Agent, Basking Ridge, NJ
Tue Oct 5, 2010
Sounds like your agent has made an effort to "escalate" the file to a higher level to get some action. I hope it works, short sales can be hugely frustrating and time-consuming, but having an agent that is attentive helps greatly.

Best,
Jeanne Feenick
Unwavering Commitment to Service
Web Reference:  http://www.feenick.com
0 votes
Diane Glander, Agent, Spring Lake, NJ
Tue Oct 5, 2010
An escalation clause is generally put into a contract when there are multiple buyers. One buyer will stipulate that whatever offer comes in, he/she will beat it by a certain number of dollars.
I've never heard of an agent putting one in on a short sale when representing a single buyer. I'm short sale and foreclosure certified but I've never heard of it being used in those transactions.
Do some searching on Trulia about short sales and you will find they are anything but quick or short! timewise.
Web Reference:  http://www.dianeglander.com
0 votes
Search Advice
Search
Ask our community a question
Home Buying in Ringwood Zip Codes

Email me when…

Learn more