Here we go

I don’t really know why I thought we would miraculously bypass going through the pains of a short sale. Maybe it’s because I had done so much research and figured I just knew everything there was to know. Maybe it’s because I didn’t think it would take all that long, even though I have heard the horror stories.

HA HA. Joke’s on me.

The timeline has gone a little something like this:

March 9, 2011: submitted short sale package to both lienholders.

March 13, 2011: realtors office called both lienholders to ensure they received packages ok. Second lienholder had, first lienholder stated items were missing in package. Resubmitted items they had mis-scanned.

March 18th, 2011: first lienholder stated package was in imaging and would be reviewed within 10 days.

March 25th, 2011: second lienholder approves short sale subject to first lienholder terms and conditions.

Fast forward. I don’t even know the dates anymore because originally I wasn’t going to blog about this. Instead of assigning the package within 10 days, the first lienholder gives us a massive runaround. We are told to wait 30-45 days for it to be assigned. We are told it would have been 10 days if everything had been there on the first attempt but since our package was incomplete then we have to go back in line. Which, I would understand, but then theoretically, if our complete package was there on March 18th (as opposed to March 9th) shouldn’t it still have been assigned to a negotiator within 10 days of March 18th?

Yeah? Notsomuch.

Then they closed out our file. Our realtor’s short sale negotiator just happened to be calling for one of her regular follow up calls and she discovered they closed out the file erroneously. She was able to get it reinstated.

Finally on June 13th they assigned it to a negotiator, almost a full 90 days after a complete package was acknowledged as received. The next day they pulled it from the negotiator because they claimed it was missing the listing agreement. Keep in mind, we were told on March 18th the entire package was there.

Listing agreement was sent immediately but then we were told we had to wait for it to go through their imaging process. What used to take 48-72 hours is now up to a whopping 7-10 business days!! No wonder nothing is getting done around there!

We called every few days to confirm the listing agreement was received, and finally on July 7th, 2011, we received confirmation the listing agreement was received. But……

Our financial documents were outdated. Unfortunately the file would not be moved back to the negotiator. Seriously? The negotiator didn’t notice that when they picked up the file the first time? My realtor’s short sale negotiator called and went round and round with the first lienholder about the fact that their imaging takes 2 weeks. By the time they image the documents then spend another 10 days to assign back to a negotiator they will be outdated again.

In the meantime, a new law has been passed that a bank has 90 days to complete the short sale process from the time a complete package is received. So in theory we would have been done on June 18th (albeit they lost the listing agreement that they originally acknowledged receipt of). I can see exactly where this is going right now. They are going to have to meet the new deadlines for new applications, and those of us with applications prior to the new date are going to sit even longer while we wait for them to pull their heads out of their you-know-where’s.

Here’s the situation with our buyers: these people are GOLDEN. She’s a doctor and he’s an officer in the military. They wrote an offer almost 15k above list price. They are putting 25% down. They asked for no closing costs to be paid by the seller/bank. They wrote the contract with NO appraisal contingency, which means if the house doesn’t appraise for the sales price they don’t care- they will pay the difference. My bank is just plain idiotic not to JUMP on this deal right now. What’s going to happen is the buyers are going to get sick of waiting (keep in mind, they wrote the contract February 19th I believe). They are going to walk and we are going to wind up taking an offer at or below list price, where the bank is going to be asked to contribute up to 6% in closing costs and oh yeah, if the appraised value comes in low then the bank will have to negotiate the price even lower.

Can someone PLEASE PLEASE PLEASE tell these banks to take a look at their process and figure out exactly why they can’t get the job done? All I’m saying is, LET ME AT IT!! I will come up with an efficient process where the customer service agents don’t have to defend themselves all day and can then be free to actually be courteous to the people calling in. Imagine that….

Stay tuned, things are definitely going to get more interesting from here.

Let the fun begin

Where do I start? I believe I posted last May/June about the possibility of not being able to keep up our investment property and that we were considering a short sale. We just kept going into the negative every month thinking there would be an end in sight. We kept thinking things would get better.



It is now February. February 26th to be exact. Things did not improve, they only got worse. Not only did my husband's income decline by 75% for the year but in addition, my incentive (bonus) which was nearly 30% of my income completely evaporated on January 1st.



Not a good situation at all.



We made the decision to finally short-sale the home. It has been hugely emotional since then and unfortunately our experience with our tenants has been less-than-pleasant since we made them aware of our decision.



I'm not sure what would be worse, being up front with them about the short-sale and offering to help them through this or if we would have just left them in the dark, planted a "For Sale" sign in the front yard and let them just figure it out on their own.



I guess let me start with the conversation I initially had with our tenants. I spoke with the Mrs. and told her that unfortunately with our situation we had been subsidizing the mortgage by more than half even with their rental income. I also informed her that my income had decreased as well as my husband's income had decreased. She expressed her sympathy for our situation but then informed me that her husband also had lost his job. Not to fear, she told me, they had plenty of income to sustain their housing payment. We agreed that we would come up with a mutually beneficial arrangement for all parties involved considering we may ask them to vacate a few months shy of the lease. We hung up.



During our conversation she told me they had already paid the February rent, although I later discovered that not to be true. She avoided my call for over a week, and when we finally did talk she told me that she had discussed our situation with her friends and she felt a fair amount of rent would be $1000.00 per month.



Keep in mind, the mortgage is $5k per month. They were only paying $2500 of that to start with. Now they generously want to pay us $1000 per month to live there while we are under contract to short-sale? Also keep in mind it costs us approximately $350 per month to maintain the property even though we aren't paying the mortgages, just with the HOA dues, home warranty, sewer, and trash.



I'm angered, to say the least.



She told me that her husband had lost his job and their daughter was going off to college in the fall. They had to pay for a graduation for her and had to buy her a new car.



How the eff is that our problem again?



I informed her that the reason we were still expecting a portion of rental income was because we anticipate they will pursue us for a deficiency. Hey, we aren't stupid. We totally expect we will be on the hook for a portion of this short-sale, given the fact that we are expecting them to take a loss of nearly half what we owe.



She seemed to think that we were going to make out in a positive way from them paying rent and in her mind she seemed to think she shouldn't have to pay any rent if we aren't paying our mortgage.



Well I have news for her. I just finished taking a Business Law class. A contract is a contract. Our contract is with our tenants. They are not contracted between us and our mortgage company. Therefore, our tenants are required to pay their rent and we are required to fulfill the term of their lease. In this case, it would run through August 31st. If they pay their rent (in full) and we do not fulfill the August 31st date then WE would be considered in breach of contract and they may sue us for the actual damages they incur by our breach (ie, unexpected moving expenses, deposits, etc).



We have tried to come to a mutually beneficial arrangement where we will accept decreased rent to help offset their moving expenses, whether we are actually able to keep them there until August or not. The way I see it, if they were able to stay there through August 31st then we owe them absolutely nothing. Under our new rent terms they would have received more than enough money for moving expenses, plus that graduation party they want us to pay for. I feel that is more than fair.



Somehow though, they want to push us. They insist that they should only pay us $1000 or $1250 a month in rent because they don't think that the additional money makes that much difference to us. And, in the grand scheme, it probably won't make that much difference. When we are signing a $30k promissory note for our deficiency, what is $1000?



At this point it's totally the principal of the matter. We have tried hard to be fair to them, knowing that this is unfortunately not within their control. We have been forthcoming and have tried hard to come up with a plan that will pay for those losses they will undoubtedly incur if they have to vacate prior to August 31st. But their adamance that they should get to live in our home for virtually free just because they know we aren't paying the mortgage is driving me absolutely to the brink of anger.



I told my husband tonight that if they don't accept one of our two offers to them by March 1st that I will contact a lawyer and start the process for breach of contract. See, at this stage, we have not asked them to vacate the premises prior to the end of the lease term so we are still fulfilling our obligation (for now). They, on the other hand, withheld their February rent from us and have not agreed to modify their original lease agreement. So if they do not pay their rent in March in full (and by full, I mean $2500) they are technically the ones in breach.



And don't think at this point that one angry Momma Bear won't pursue them for it.



They should have just taken the offer when I first made it.

Still debating, short sale it or what?

Funny. One year ago we were in contract to buy a short sale. Everything was falling into place, we got loan approval, we found tenants to rent our home, all was good.

In just twelve short months they closed our office in Las Vegas, forcing us to either relocate if we wanted to stay with our employer or try to stay in Las Vegas and find employment in a market already beyond tapped. We reviewed our options and decided to relocate.

All in all, not a bad decision. However, in the six months since we have relocated my husband has taken a 75% pay decrease. It isn't because we relocated, really, there are a combination of factors involved. First of all, our co-workers that didn't relocate stayed in Las Vegas and opened up a new division of a competitor. We knew we would lose business to them, and although we don't know exactly how much business we have lost to them we can only guess it has been significant.

Second, the regulatory changes that hit the industry on January 1st of this year have really made a dent on how long it is taking to get loans to the finish line. More regulatory changes are in effect beginning July 1st and we have begun to wonder after those are implemented just how many people will be left standing.

The big thing for us is the morality of having to short sale a home. We didn't buy a home that was over our means. We weren't tricked into a loan product that we didn't understand. We bought that home five years ago and have remained conservative with our use of credit. We aren't in over our heads as far as some of the stories you read about people overextending themselves and then walking away. The sad thing is just that we have lost nearly 75% of my husband's income in the last 12 months. Considering he is the breadwinner, you do the math. We have also continued to make the payments on that home every single month even though it is putting us 4k in the negative. (Originally I calculated it as 5k but after recalculating we are lucky, it's only 4k).

I never got the fax from the first lienholder when I requested it so I called back. When I got someone from the loss mitigation department on the phone he told me that they never fax "work out" packages and he didn't know why the first guy told me he would do that. He also made a comment that angered me. He said "I can see your loan is current. I don't even know why you are calling us."

Well.

Our loan is current because we are going into the negative every single month to fulfill our financial obligations. We signed a note saying we would do that. However, we cannot do it indefinitely and we want to review our options. I asked him about discussing our situation with someone there to see if we would even qualify for a short sale and he told me that wasn't an option. Apparently they will not even review your workout package until you are at least 30 days delinquent (hint, stop making your payments so we can work with you) and also contrary to what the first person told me when I called, I cannot submit my package without a purchase contract.

So that puts us in a catch 22 position. We would have to list our home for sale and stop making the payments just for them to consider if they would work with us. And if the answer is yes, then great, it would maybe work out. But if the answer is no, then we have not only wrecked our credit but have also put our tenants to the streets.

We are considering marketing the home as an investment property with tenants, but even short saling it, you tell me who is going to want a 450k investment property right now?

My heart is just broken over all of this. My morals are telling me to just keep draining everything I have until either the market improves or our income improves. Neither of those options are looking likely in the near future. My heart is telling me that we have a family living in that home that has cared for it better than we have- they have even landscaped our courtyard that I could not convince my husband to do anything with. They deserve to live in that beautiful home and keep their children in one place. My financial sense is telling me that if we continued to deplete all of our resources to keep that sinking ship afloat we may wind up losing more than just that house. We have two kids to raise ourselves and the cost of childcare is not cheap. Not to mention, just a few minor emergencies and we could be living beyond our means in a hurry.

So here we are, a few weeks later, and we still have not made a decision if we are going to keep the house or pursue a possible short sale. Having been on the other side of the short sale fence just one year ago I just don't know if I have the patience to go through it again. Decisions must be made in the next couple of months though, so I will keep you updated.

I can't believe I am even in this position

With the last four months being, well, worse than we can ever remember in our lives we are seriously reviewing our options as it comes to our house that we retained in Las Vegas.

Where do I really begin?

We have tenants in our home, kind tenants that we absolutely love. We know they are taking good care of our home. We feel responsible for their family as well as ours, knowing that they have been through the wringer when it comes to housing. First they had a bankruptcy due to their self employment situation. Then the home they were renting went into foreclosure and the owner didn't even have the decency to tell them what was going on. They found out by accident. Without a doubt they probably check the recorders website every single week wondering if we are going to do the same thing to them.

But the last four months? Not so good. We are going $5000 a month into the negative just covering our expenses. You have to imagine, that can't last forever. So each month we think, "Next month will be better." Each month, not better, and no end in sight.

I was speaking with a coworker the other day whose mortgage is held by the same company as mine and she told me that she recently did a short sale. The line of reasoning was that her employer moved more than 50 miles from her home and it was a hardship to her. I am wondering, does that count six months after the fact?

I mean, they closed our office December 31st. We have sustained as long as we can, but I just can't see us tapping any further to make ends meet, especially considering we have no idea how much longer this is going to take. The thing is, I just can't bring myself to really do this. I just don't know how I am going to give up like this.

I made the call to the lender. They told me they would fax me the short sale package within 30 minutes. It never came. If this is any indication as to how this would go, I think maybe I should just put it out of my mind right now.

The End of the Road

I realize its been FOREVER since I have posted an update. (This is East Coast Jenn, BTW). I think I told you that our short sale offer fell through because of BoA's ridiculously long short sale process. The buyers finally walked away...and 3 weeks later, the bank came back with a response. Of course, by then it was too late. We kept the house on the market, but never had any more offers. Finally around Christmas, feeling like we were out of options, we decided to start the process of getting approved for a Deed in Lieu of Foreclosure. For those of you who don't know, its where the bank will accept ownership of the house as payment for the mortgage. It is a little better (not much) on your credit, and keeps you (and the bank) from having to go through a long, drawn out foreclosure. There is a pretty involved approval process...we had to supply them with detailed financial information, a hardship letter explaining why we had to go this route, and other miscellaneous personal info. After a few weeks, we heard back. The bank said they would accept the offer, but they wanted us to sign a promissory note for $35,000 over 25 years. Basically, we would lose even MORE money on the house. I understand why they wanted us to do it...after all, they are taking a loss. However, if we did have the money, we would have given it to them long before!! We negotiated back and forth, and finally settled on a lower amount. I can tell you though....we did the giving and they did the taking! We finally got word last night that the deal would be approved, and guess what?? We have three weeks to get the heck out! They wanted to give us TWO WEEKS! I told them there was no way we could be out that fast, so they said three, max. So, now I am in panic/crisis mode. I have to get this house packed, find a place to live, and try to get our taxes done so that we have a rent deposit, all while being pregnant and raising 1 year old twins!!!! CRAZY!
I have to say though....as hard as this has been, and will be over the next few weeks, I am glad that the end is in sight. This has caused no shortage of stress around here. I will be glad to get moved and settled somewhere. I will do my best to try to keep you updated, even though my situation no longer pertains to a short sale!!

West Coast Jenn gave up on the short sales

My apologies to those that have been awaiting any news that I might provide a short sale success story. I can't believe I last posted almost sixty days ago. Six zero.

So much has happened in sixty days I don't really know where to begin. We pulled the plug on both of the short sales that we were in contract on. The first one (BofA) we had been in contract for five months and they still had not even completed a BPO. The second one (Suntrust) was relatively new in it's timeline but never really had a chance to work through to see how it would go.

We have been busy packing and working on closing our local office so that we can relocate to work from our Arizona branch. For a fleeting moment we did consider holding out to buy a short sale in Phoenix but then I remembered all the headache and disruption it has been to our lives so we passed on that option.

Originally we were going to get out to Phoenix and rent for six months or so until we could figure out the lay of the land so to speak. One crazy day we decided we were just going to buy something so that we could put this all to rest. When I say crazy I really do mean crazy- we wrote an offer on a "flip" property that we had never even seen. In a neighborhood we had never visited.

So if you want to know- we got the house. We are closing on Monday. But don't think that there is any less stress that comes with buying a flip property and let me tell you why. First of all, if it is being sold in a time period less than 90 days from when the investor took ownership you are in for all kinds of headaches. Currently VA is the only loan type that does not prohibit a flip transaction, but we are not veterants.

Fortunately for us the home was nearing the 91st day from when the seller took ownership so we waited until that day and submitted the contract right out of the gate. If we were obtaining conventional financing and the seller had listed the home at more than a 15% profit over what he purchased it for then we would have been in for even more headaches. Lucky for us we were able to qualify for FHA financing and because the home had been owned for at least 91 days we only needed to obtain one appraisal.

However the appraisal was shaky at first, and we were scared we would need to go for an appraisal review. I see very few appraisal reviews that agree with the original value, most come back with a cut to the value. We wrote the contract without an appraisal contingency so this meant that if the appraised value was substantially lower than our sales price we were still locked in to our sales price with no repercussions on the seller. Note to most average buyers out there- this is NOT, NOT, NOT a good idea. We were playing with fire. Fortunately for us we did not get burned- too bad. The value did come in $2500 lower than our sales price which means we are completely out of that cash but for all the housing problems we have had over the last seven months with trying to purchase a home we figured it was collateral damage. We were ok with that.

We are moving one week from today. Incidentally, the home does have a basement. So the house that started this whole crazy blog - you know, the one with the basement that we just had to have? Well, we still got our basement, just happened to be in another state.

Everything happens for a reason.

update from sc

ahhhh...i havent posted in forever!! my regular blog has divorced me because i ignored it for so long. i do have good news though. i just saved a bunch of money on my.....never mind. no, i really do have good news! we were assigned a phase 1 negotiator this week. i spoke with her yesterday, and she assured me that she would begin working on our file on monday!! yay!! also, boa ordered an appraisal on the house. the appraiser came by on friday, and he said he would have his report to the bank on monday. so it sounds like things are starting to happen!!

on the flip side though...our realtor called this week and told us that our buyers are going to start looking for another place, because its taken so long to get anything moving on this house. i am just hoping that we will make some progress and they will hang in there for a little bit longer. keep your fingers crossed for us!!

West Coast Jenn Update

I can't believe I haven't posted in at least two weeks. Wow.

Well, for those that are wondering, we pulled out of escrow on the Bank of America/Countrywide short sale. Five months in, no BPO back, and several incompetent negotiators later we decided that we could stand no more. Luckily for us our sellers were kind and let us out of the contract. Lucky for them their house went right back into contract, probably within 48 hours. I will hope that they are able to close quickly- but I will definitely be keeping my eye on that home to see when it finally does close escrow (and for how much!).

We did actually get a bank owned offer accepted. YAY! Sadly, we also got some not-so-fortunate news about our jobs so we opted to decline the bank counter on that home. We still have jobs- they just won't be based out of our same office. We will have to relocate in order to preserve them. The last two weeks have been pure hell. Stay? Or go?

We also then decided to tell the seller of the other short sale we were in contract on that we wanted out of escrow on that home as well- more because we did not want to prolong the escrow period and possibly run a chance that the home would go into foreclosure if we did not provide enough notice that we were not going to close on it. I would forever feel responsible for putting the seller in that position so we did notify them right away. I think it was about two weeks ago now.

Actually, tonight I spoke with my realtor (who incidentally has become an even closer friend than she was before) and asked her to call the listing agent of the Suntrust short sale home. They are still waiting to hear from the back up offers if any are interested enough to pursue escrow before they remove it from contingent status so I asked my realtor to let them know that there is a possibility we would still be staying in the area (myself with a different employer, my husband with the same one) and that we would hopefully know within two weeks. If the seller is interested in waiting out our nightmare for the next two weeks we would really like them to keep us in escrow. We really, really want that house. I have been dreaming of the half acre lot that the home is located on and all the fun things we could do with it.

Needless to say, this has been an emotional few weeks for us. Let's recap, shall we?

We went into contract on a BofA short sale in May. Moved out of our home and leased it to tenants for the next two years in August. Wrote several offers on bank owned homes and all were rejected. Went into contract on a Suntrust short sale in late September. Found out in late September/early October that the rental we are living in is in pre-foreclosure. Found out our employer is closing down our office and we will either have to relocate or find new employment. Finally got a bank owned offer accepted but had to decline it because of the tenuous employment situation. Let go escrow on the short sale that started this whole ball rolling. Let go the short sale that we had our hearts set on after the first short sale we were in escrow on. Living in total chaos with no idea what tomorrow will bring, or what state we will even wind up living in.

Hmm. Just another day in Paradise?

news (or lack thereof) from south cackalacky!

well, we have had a FEW things going on. i've talked to the bank a few more times since i last posted...pretty much the same story there. loan is STILL in modification. go figure. i did talk to someone yesterday who seemed like she might be able to help. most of the time when i call, no one in the short sale department will give me the time of day...they just send me straight to the modification department to try to get the file transferred back over. finally, a nice woman named nana (yes, that was really her name!) said she would try to help. she brought her supervisor over and explained my situation. the supervisor told her what buttons to press, and said it should be done by monday, and for me to call back then. time will tell...

also, we had a couple come by last thursday and look at the house. they didnt come with their realtor, they just showed up at the door at 6:30 in the evening and wanted to know if they could take a look around. of course i said yes. they loved the house, and said they would be writing an offer the next day. i was very up front with them and told them that we were doing a short sale. i got a call the next day from their realtor saying that they wanted the house, but couldnt make an offer because they needed to do a contingency offer, and of course, the bank wont accept contingency offers.

lastly, a gentleman from out of state came today to look at the house. he loved it as well. he was particularly excited because we have high ceilings in our garage. weird huh? it seems he is a car buff, and wants to install a lift so that he can look UNDER his cars. my agent called this evening and said that he wrote an offer this afternoon, BUT he has to close within 30 days. i told my agent that the only way that could happen is if he offers the amount that we owe the bank. that amount happens to be oh, about $40k more than his offer. doubtful. even knowing that there isnt a chance in hell that he will do that, i will still go to bed tonight hoping and dreaming! it would really be perfect if the house sold right now. my husband's company has a job right now in myrtle beach...he's been going down there 2-3 days a week. the company decided to go ahead and rent a house down there for the next year since he will be there so much. if our house sold, we could all just move down there and live rent-free for the next 10-12 months. did i mention that they are looking at ocean-front houses with pools? yeah. so keep your fingers crossed for me m'kay? by the way, i thought i would show you a picture of our house. i like to post pictures of things, and since this is a blog about buying and selling houses, i thought it might be appropriate!

Quick Update- East Coast Jenn!

I had to give myself 24 hours before writing this post. I'm not kidding. I can totally understand the perspective of those people who just go postal on a business that they feel has wronged them. I can not explain the rage I fell when I get off the phone after having been d!*%ed around by one of BoA's "service" reps. When I called last night, they told me that our file is STILL in modification. Just to review:
Submitted all paperwork on 8-24
Paperwork sat on fax until 9-9
I called every other day or so until 9-23, when I found out that our file was sent to loan modification "by mistake".
Since then I have called on 9-23, 9-24, 10-1, 10-6, and 10-9. Each time I call, they tell me that they have transferred the file back to short sale. Each time, they have lied.
My realtor sent me another text last night saying that he feels like the buyers might stick with us if we could only give them something to hang on to. I wish I could. My husband decided it would be a good idea to write them a letter. I suggested that they just come read this blog!! Thats all the updates they need! I will include the letter that my husband wrote. It hasnt been proofread yet, so forgive the mistakes. I am just too tired to re-read and proofread it! As Jenn has said before...please dont copy content!

October 9, 2009

Dear Home Buyers:

My wife and I wanted to take some time to give you an update as to where we currently stand with Bank of America regarding the short sale process of the sale of the house. First of all, we wanted to thank you for your interest in our home. We have thoroughly enjoyed living here and will be sad to leave, but due to circumstances beyond our control, it is imperative that we move. We know that you will truly enjoy living in this house!!

As you are well aware, we listed the house well below market value with the intention of pursing a short sale with Bank of America. We had tried unsuccessfully to sell the house at or above market value for six or so months, but due to the economic climate we were unable to sell. Like many homeowners, we have experienced some financial hardships and our options are limited as to how we can remove the debt of our home and minimize the financial damage. The best option for us is to sell the house at market value. The worse option is foreclosure. Because we are in a “buyers market” right now, we elected to purse the short sale process with our Bank of American. This limits the financial loss to BOA and limits the damage done to our finances. Foreclosures costs banks approximately $30,000-50,000 dollars; therefore banks are very open to the short sale process because they can recover the majority of their investment.

The short sale process is extremely buyer friendly because the buyer is almost completely assured of receiving a great deal on the purchase of the house in question. Using this house as an example, you will be receiving, essentially, a 20-25% discount on the purchase of this house. The downside to a short sale is that it requires a little extra measure of patience. Any time a bank is faced with losing money, they try many different “offers” to entice the homeowner to remain in the house (this has been our experience at least). Bank of America has been making “offers” to us over the last 6 weeks, all of which are in an effort to minimize their losses. Because we want to move (and need to), we have declined their “offers” but it has taken an unfortunate amount of time for them to “get the message” that we are not interested in staying in this house. Bank of America is a multi-trillion dollar company which means that they are massive and have many layers which equates to things taking a little more time to get done compared to a local credit union.

With all of that said, we currently know the following:

1. We have transmitted to Bank of America all of the documentation that they have requested thus far.
2. Bank of America has a file set up for our short sale account.
3. They are currently reviewing our file and the documentation contain therein.

If you were to equate it to a 5 step process, we are beginning step 3 which involves a “negotiator” that has been assigned to our short sale account. He will review our account and documentation and will make an initial assessment which will then have to be approved by his superior. That would be step 4. Step 5 will be getting the paperwork generated and move toward a closing date.
I know this has been a frustrating process for you as it has definitely been a trying time for us as well. We are trying to remain patient and truly hope that you will remain patient with us. We are fully committed to seeing this process through until the end.

After all is said and done, you will purchase this house at a great discount and will truly enjoying living in here. We know the long term enjoyment your family will have here will far outweigh the short term process we are going through now.

We stay in contact with the bank at least twice a week to receive any updates they may have. We will continue to push the process through as quickly as we can and will start providing weekly updates through, Brian, our realtor. Should you have any questions, please do not hesitate to pass any questions and we will answer accordingly.

We are looking forward getting this short sale completed and for you to move in!!!

Sincerely,

Travis and Jennifer

Today's Update on Bank of America Short Sale

Do you recall that I mentioned a BPO had been ordered on the Bank of America short sale and it was supposed to be back on the 22nd of September? And then do you recall that somehow the BPO wasn't back and the file got reassigned to a new negotiator on the 24th of September? And finally, do you remember how I mentioned that the new negotiator had not replied as to the status of the BPO?

Today's update was that the new negotiator ordered the BPO on October 6th. What happened to the one that was ordered and was expected to be returned two weeks prior to that?

Next follow-up date is scheduled for October 15th. Remember me saying that I automatically added thirty days to the date they gave us for delivering any updates?

Well, I must say, today we had enough. After nearly five months of insanity, incompetence, and outright stagnance we asked our realtor to cancel escrow. Can you believe we even held out for five months? I still can't believe it has been close to five months since we started this process. Five months, and still there is no BPO back. No idea if our offer was even going to be accepted by Countrywide/Bank of America because they had no idea what the value of the home was yet.

I do feel bad for the sellers. I know that with their beautiful home (with a basement!) they are not going to have any trouble lining up another buyer again- and hopefully they will find someone that is willing to pay more than we were to compensate for the headache they will have to endure to get the transaction to the finish line. But I do feel bad because with Bank of America they will have to start all over with getting their short sale package back in. I feel bad because, like me, they probably really just want closure to this whole deal. Unfortunately, I can look for closure by trying to buy another house. They won't get closure until the deal actually closes or until the house forecloses. Sad either way.

So as of right now we are still waiting to hear if our offer got accepted on the bank owned home. But, as crazy as I am about having an alternate plan, we are looking at another bank owned home tomorrow morning just in case this one doesn't come through. The one we are looking at tomorrow has been on the market for almost two months with no offers so either there is a dead body in the living room or something is seriously wrong with it. I figure we can likely remedy either of those situations if we absolutely had to so if it means we will finally get an offer accepted we are going to proceed.

Stay tuned. You can't juggle with less than three balls, right?

No Update- From Vegas Jenn

I started to title this post "The Waiting Game" but unfortunately I already had one titled that. There seems to be a recurring theme here, huh?

We are still waiting to find out if we are going to get accepted on the bank owned property we wrote an offer on. We wrote the offer on Tuesday, one week ago from yesterday. We heard back on Monday night that they wanted our "highest and best" offer.

We bumped up our sales price and dropped the request for seller concessions. We wrote another nice letter to the asset manager, likely which did not get sent to the asset manager at all. And we hoped that it would be enough to convince them that we were most deserving of this home.

Today our realtor called and let us know that since this is a FNMA owned home there is a closing cost worksheet that needed to be filled out. I wasn't really sure 1) why this needed to be completed when we asked for no closing costs and 2) why they didn't just ask us all to do this at the same time that we sent back our highest and best offers?

Instead they gave all of us until the end of the day today to complete our worksheets and resubmit to the listing agent. That means they will send them to the bank tomorrow, and maybe the bank will have them reviewed in time to let us all know before the weekend which lucky couple will win the contract to the dream home. I really am hoping it will be us.

See, we want nothing more than to put all of this behind us. We want closure. We want to KNOW that there is an end in sight. It's great to have a short sale (or two) going, but a short sale means nothing until the keys are in your hand. Have you heard the comment "short sales are too unpredictable"? If only I had a buck for every time I heard that throughout this process...

But little secret here- bank owned are no sure thing either. Maybe they are "sure things" in other areas of the country- maybe it is specific to my area that bank owned homes are harder to come by than a home that actually still has any equity left in it. I don't know. All I know is I cannot believe the mess that we are in.

I cannot believe that buying a home (which, incidentally is hard enough to qualify to buy anymore) is actually not as easy as going out, looking at a home, and making an offer. The process goes a little like this:

Go out. Look at a home. Fall in love with it. Submit an offer. Wait for it... Wait for it... You get nothing. Move on. Shake it off. Find another. Fall even more in love with it than the last. Build hope that it will come through. Submit a more aggressive offer. Wait for it... Wait for it... Rejection. Find another home. Repeat. And continue repeating until you either find a home that will "just do" or you give up.

So far we aren't at the "anything will do" point, but it is scary to think how dangerously close we are. If you want to know, I will be blunt. If I had any idea how this whole thing was going to play out I absolutely would not have done it. We are conservative people by nature. We try hard to make sound financial choices and to make wise decisions when it comes to not moving too quickly or acting irrationally. Some might say that is a fault- considering we have probably made half the return of what we really should be making on our investments.

The other day I was asking myself, why did I do this again? It took only half a second for me to remember. I did all of this for my children. I did this for their safety. I did this to make sure that I could always provide a safe place for them to play- both inside the house and out. I guess that's all the motivation we need to get us through this. It really is true- you will do anything for your kids.

i knew this would happen...

I got a text message from my realtor yesterday:
"the folks [buyers] are getting nervous, per their realtor. i told her we would check with the bank again on monday"
first of all, i am checking with the bank ALLOFTHETIME!!!! i don't know what more i can do. they are a bunch of incompetent imbeciles, and there just isn't much i can do about that.
secondly, when we found out that these buyers wanted to put an offer in on the house, we were very up-front with them. we told them we were going to do a short sale, and we told them it would take longer to get it closed than a standard sale. much longer. i told my realtor to tell them at least 90 days. i hope he told them that, and didn't fudge it a little to make it sound better. i am going to assume he was honest with them and with me. we offered to sign a short term lease on the house so that they could go ahead and move in. i don't think their realtor ever went to them with that offer...she didn't think it was a good idea. she was probably right, but we were willing to assume the risk just to keep them from backing out.
third, they offered $205,000. we were asking $230,000. if the bank accepts their offer, they will be getting a steal! seriously, a STEAL!

i guess i'm just frustrated, because they have barely even given it 30 days, and they are already getting "nervous". i just know they are going to back out, and then we are going to be at square one, and facing a foreclosure. i cant imagine what that will do to my husbands credit. i checked it the other day...it has dropped over 200 points in 5 months. i guess it cant get much worse, huh? on a side note...i think its funny how it takes at least 6 months for good things to show on your credit, but bad things show up immediately!! i guess that's another gripe for another day!

The Waiting Game

If you are wondering what is going on with Jenn-the-buyer (AKA Vegas Jenn) I will tell you- we are just in a holding pattern.

Here is the situation:
1. Currently in contract for a Bank of America Short Sale (went into contract mid-May). No BPO received as of yet. Still in "Phase 1". As of yet seller has not had an NOD filed. No end in sight
2. Also currently in contract for a Suntrust Short Sale. (went into contract mid to late September). Have not received all seller signed addendums and according to listing agent the short sale package was "partially" submitted to Suntrust. Seller has an NOD (Notice of Default) that was filed on July 31st. Looks like potential trustee sale would commence around end of November or beginning of December. No end in sight.
3. Contract written on a FNMA owned property. No reply as of yet. Contract was written Tuesday September 29th. At the time that we wrote the contract we were the only offer in hand. Not surprisingly there are now multiple offers so we aren't holding out much hope. I can't say there is no end in sight on this as at least we should know by Tuesday or Wednesday if they have accepted it or not.
4. The short term house we are renting is currently in pre-foreclosure. We discovered that two days ago and it appears that we have until approximately mid December before the actual foreclosure and bank possession will occur. So what does that mean? It means that with the current timelines on closing escrow we will need to get an offer in on a house and get it accepted within the next few weeks in order to not find ourselves with a notice taped up on the garage and a lockbox on the door.

Oh yeah, and while we were at the park this afternoon with the kids someone stole our cooler right out of our wagon. We feel the black cloud hanging over our head right now.

^#&@&$*@^@*#^#(@& (east coast jenn)

Forgive the title. I cant think of any words bad enough to express just how pi$$ed off I am. I called BoA last night when I got home from our quick trip to the beach. If you remember, they transferred our loan from the short sale department to the loan modification department. We called last week to have in transferred back over, and they told my husband it would be done by 3 or 4 o'clock the next day. That was on 9/23. I called back on 9/24, just to make sure it had been done. It hadn't. Thee person I spoke to that day told me to call back on the 28th (Monday). I didn't call until last night because I left all the information on my desk at home. When I called, they said the loan was STILL in modification!! Because the loan is in my husbands name, he has to be the one to call and "decline" the modification. I had him call last night and ask wtf is going on, and the guy he spoke to in modification told him that it would take ANOTHER 10 days to get it out of modification and back into short sale, where of course we will have to go through the whole waiting to get a negotiator thing again. Just typing these words is making my blood boil again!!! I just cant believe that these people can get away with running a business like this!!! I don't know how Vegas Jenn has done this for 5 months!! I just started, and I feel like going crazy! More later...I need to go take a blood pressure pill!!

UNBELIEVABLE...

You know, we were scared to death to rent our home out and move to a short term rental. We have heard the horror stories and have had friends and acquaintances that have fallen victims to renting homes that have gone into foreclosure.

I have watched the recorders website like a hawk to make sure that we wouldn't come home to a notice taped up on the door. I was surfing around tonight (because that is my habit- even though we have three contracts out and at least two accepted I simply cannot stop looking for alternate plans) and low and behold guess what I came across?

Yes, somehow in my daily search of the recorders office I was using their pre-set formula for searching foreclosure documents. Unfortunately that pre-set list of doc types did not include the one where the NOD was filed on the property we are renting.

We signed the lease on August 13th. The NOD was filed on August 17th.

I cried.

I cannot believe this. We have been so careful- have worked so hard to make sure we watched for this. We felt like we could trust our landlord. Now we are scared to death we aren't going to get our $2500 security deposit back because there is a good chance it could already be spent or that he never intended to give it back. And we are also worried sick that we won't finalize something with our housing situation soon and will indeed come home to find that notice on our door.

Fortunately the laws have changed to improve the rights of tenants living in foreclosed homes. I am going to have to spend some time brushing up on them soon, just in case.

At this point we are:
1) hoping we get the contract on the FNMA owned home and can close within 45 days.
2) considering if we do not get that contract asking the seller of short sale #2 (Suntrust) if they will sign a two year lease to us and let us proceed with moving into the home. Knowing full well we will definitely end up paying rent that will not be paid to the bank and also knowing full well that if the short sale does not go through and the home does foreclose we will have to move yet again.
3) considering skipping any further thoughts of trying to get into the resale market here and instead going straight to another new construction home.

What would you do?

Bank Owned instead of Short Sale?

I realized that last night I posted about the bank owned home we put an offer in on and forgot to tell you that we had even done that!

We viewed a home that is owned by FNMA on Monday, wrote the offer while we were at the house but asked our realtor to hold it while we discussed the pro's and cons. It wasn't exactly the original home we had in mind, but it does have a basement and it does have much potential. I just don't want my husband to feel he is "settling" for a home he doesn't really want. So I wanted to talk with him in private about that instead of putting him on the spot in front of our realtor.

As we drove back to work together we talked. We decided there were lots of pro's- and in the end we flipped a coin to see if we were really going to proceed with the offer. Tails won and we we had our realtor submit the offer Monday afternoon.

So many people post or comment that bank owned is the only way to go. Let me tell you why I don't necessarily agree. First of all- IF you get your contract accepted on a bank owned home, then indeed you will at least know that you will be closing. (someday) But in our market, in our city, you might have to look at fifty bank owned homes, write contracts on ten, and if you are lucky- you might get one of them.

Then when it comes to closing the loan? Well, remember, I am in the business. It is probably 50/50 right now when it comes to value coming in at what the contract was written at. When the review appraisal comes in there is at least a half chance that the value is going to be cut. Back to the bank you go to renegotiate the sales price. Do you think this occurs quickly? No.

Even buying a bank owned home does not guarantee a speedy close. I have seen some bank owned transactions drag on for four months while all parties continue to disagree about things. I suppose that is why the banks right now are in favor of cash over financing- so there will be no appraisal contingencies.

How do we feel at this point? I mean, we are almost five months into a short sale and still have no information that indicates any end is in sight or that we are any closer to the finish line than we were five months ago. The market is moving and we aren't certain if we are going to be priced out now. We have a rate lock (not highly recommended for anyone out there that might be considering locking a loan without bank approval of a short sale) and we just had to renegotiate and relock it yesterday. It was going to expire in two weeks. Now we get sixty more days but there isn't a snowball's chance that the loan is going to close in sixty days so we might lose our up-front lock fee. We have been viewing homes and making offers to no avail. Banks won't touch us because we have financing (albeit we had rock solid loan approval and only needed a contract and an appraisal). We took the conservative approach because we were retaining our other home and didn't want it to sit empty once we closed on the new home. We found renters, we moved into a rental ourselves and have been living in hell.

They do say hindsight is 20/20.

Weekly Update on our Bank of America Short Sale Purchase

Today was our scheduled update day. I look forward to it like a prisoner looks forward to their fifteen minutes of sunshine once a week. I obsess about it. I try not to think about it but I do count down the days (hours, minutes) between each update.

Today our update was something to the effect that the file had been reassigned to another negotiator on September 24th. The short sale processing company obtained that negotiator's e-mail address, sent an e-mail to ask for status, and noted that the next follow up date would be October 7th.

Good thing I wasn't holding my breath for that BPO that was supposed to be back on September 22nd, huh? I was bitter like a prisoner whose fifteen minutes of sunshine were rained out.

On top of that, the Suntrust short sale that we are also working on pursuing has been nothing but a joke. Originally I was very optimistic that the listing realtor being the direct point of contact for the short sale negotiation would net much better communication and faster results than using a short sale processing company. Now? Not so much.

So we wrote the offer on the 10th of September. Today is the 30th of September. The listing agent has been unable to meet with his clients to obtain their signatures on all of the addendums that we had going. So do we really have anything?

The listing agent said he submitted a partial package to Suntrust so they would note the file that a short sale was in process and would postpone their foreclosure proceedings. Yes, because short sale lenders love it when you piece meal things to them. They will take a partial package and fully process it just waiting on you to complete the items they needed from the get-go. NOT!

Today's updates on both of the short sales we have going were just a joke. The girls at work were teasing me that I am just a glutton for punishment. I told them that if I let go of our contracts on these short sales then I wouldn't have anything to complain about every day. I can't let you folks down now can I? I mean, you come here for my daily super-dose of sarcasm and pessimism, right? And I can't very well write something that I just don't feel or understand. So I guess in essence I am really doing this to myself in the name of research. For my blog. For you all to benefit from my torture and not make the same mistakes yourself.

Did I tell you about my friend in New Mexico that is short saling her home? Her first lienholder is Bank of America. She told me it took them seven months to approve the short sale. The approval came one day after her buyers cancelled escrow. She was fortunate and found new buyers- I will have to check in with her to see how that is going. I will update you.

And I guess since I blog so much and have so many irons in the fire right now I should mention that the bank owned home that we wrote a contract on yesterday is still up in the air. My realtor did confirm that there are no other offers on it as of right now and that our offer was submitted to the seller (FNMA) but that it would take 3-5 days to hear back and that if any other offers do come in the interim they will also be submitted to the bank.

We are trying not to get our hopes up about it and all, but like one of the girls at work was teasing me- I obtained a copy of the original builder floorplan and have been using colored pencils to sketch in where our furniture will be placed. I'm not hopeful about it or anything.

C'mon back now. More updates as I get them.

Welcome Jenn the Seller!

I just wanted to take a minute to thank Jenn the Seller for agreeing to bare her soul to us with regards to the short sale process with Bank of America.

What Jenn has described in her post is so very common. I am a mortgage professional and I cannot tell you how many times I have seen a loan officer trying to pound a square peg into a round hole. Likely because they will get "three points back". (Wondering what "three points back" means?) Three points back means that the loan officer will receive a yield spread premium from the investor on your loan in addition to the up front fees that they are charging you. Rebate. Consider it a referral fee for them bringing you to the investor.

In my market I used to have loan officers ask me what the rates that day were. When I asked them which rate they wanted to know about they would say "whatever gets me three points back." I also think there is a high profile sports car roaming around our city with the license plate to that effect. 3PTSBCK . Maybe I am wrong. Maybe his car has since been repossessed. I can only hope.

What Jenn the Seller has described about a loan officer trying to place them in an option arm is a very real part of our mortgage crisis and in fact does continue to happen even right now. How is that, you wonder? How can that continue to happen when the mortgage industry has been purged of these "exotic" loan products?

The truth is- there are still a number of loan officers out there that feel that every single borrower is entitled to a home loan. That means that right now there are still loan officers that are more about the almighty dollar than doing the right thing. Sometimes instead of telling a borrower they can get a loan right this minute what they should be telling their borrowers to do is to pay down some of their debt. Then save some money for a rainy day. Write a budget. Take a homebuying class. Come back in twelve months and let's see how far you've come.

That is NOT what is happening, folks. Right now there are still people in the mortgage industry that have refused to embrace that not EVERYONE is entitled to a home loan. So they are trying hard to pound those square pegs into round holes. They are taking borrowers who have no money in the bank (as in, they live paycheck to paycheck with nothing left over), borrowers who need gift funds just to close their loan, borrowers who need to add family members just to qualify for the loan- and they are trying to tell us that these borrowers are completely ready to own homes.

Just a few questions. Will the brother from out of state really pay the payment every single month if the borrower can't do it all by themself? What if the borrower's car breaks down and they need to spend $2500 on a transmission? Where will that money come from? Great Uncle Sal that "gifted" them the money for the down payment with no expectation for repayment? Is it just me or are my relatives all misers? I don't have one single relative that I could go to right now and say, hey, I need five grand for my down payment on my house. Think you can just give it to me? I'll never be able to give it back.

The truth is- you have to know when gift funds are involved that there is some sort of unspoken agreement that the funds will eventually be repaid to the donor. (Even though all parties sign this gift letter saying the funds are not expected to be repaid). The other thing is- even on paper when a borrower seems to make enough money to make the payment (hey, Desktop Underwriter said it was approve/eligible!) do they REALLY have the ability to make that payment?

I am not a mortgage underwriter but I am a mortgage professional. If you look at every file with pessimism you will no doubt see how every borrower could potentially default. That's not what I am saying we should do. But what I am saying we should do is have a few more tough conversations with people. What good does it do to get a homeowner into their dream home if they won't be able to stay there?

You see, what happened to Jenn the Seller could have been completely prevented. If they were able to stick around that $160k mark for their dream home that they originally planned they might have been able to stay in it. Instead they believed in their mortgage professional telling them they qualified. Qualifying and actually being able to make the ends meet really are two different things.

It has been a real eye opener to us to have to go through the homebuying experience in this market. You see, almost five years ago when we bought our home we were told we had to go stated income. He told us that even though we made enough money full doc that their full doc program limited them to a 45% debt ratio. We were 46%. Instead, we could state our income and go up to a 50% debt ratio.

What? I argued and argued and argued with him. I disagreed wholeheartedly that on a full doc loan we would not be able to obtain an exception for a 1% debt ratio variance. I lost. He was persistent enough to tell me that if I did not agree with the stated income loan we would have NO loan. We wanted the home bad enough, so we did the loan stated income. For the record, we did not lie about our income. We stated exactly what we made on our full doc income- but the difference was that because a stated income loan allowed us to go to 50% we were fine with our 46% ratio.

So are you wondering what difference this makes? It meant that our interest rate was higher. Not only that, but instead of qualifying for a fixed rate 2nd mortgage we had to obtain a heloc. Within our first three payments on the house our heloc payment went from $300 a month to over $1000 a month. This was for our second mortgage only! Now get this- those payments that increased by over $700 a month did not even cover our minimum payment. If we paid only that amount we were actually adding on to our principal each month. We had to pay $1200 a month just to stay at our principal balance.

Are you sitting there in shock? Yeah. We were too. Already for us our payment had tripled from our starter home. Ever hear of something called "payment shock"? Well, we had it. Payment shock is where you take on a payment that is substantially higher than anything you have ever paid before in your life. They call it payment shock for a reason. We were pretty blessed and were able to afford our home even with the payment shock and the heloc increase. But we were also mortgage professionals and knew that we couldn't sustain that forever. We put in a swimming pool, had our home appraised, and refinanced out of those loans just twelve months after we got into them.

And we thank our lucky stars every single day for it- because just two months later the decline began. We never would have had the equity to refinance our home and would be coming up on our first arm adjustment next month. Fortunately for us we are in a fixed rate thirty year loan now. No surprises. We can budget and know exactly how much our payment will be. This year, and the year after that, and the year after that.

But can you imagine if we weren't so fortunate? Can you see how this has all happened? And how even though those exotic loans really aren't out there anymore that the problem has not gone away? Does this not disturb anyone? Or how about this, does this not disturb anyone enough to take responsibility for themselves? I was at a presentation but on by one of the mortgage insurance companies a few weeks ago and the comment was made- if we each take care of only one person this problem will resolve itself.

How true is that? I can only take care of my own integrity. I can only take care of my own honesty. I try hard to be the moral barometer of my company- and by doing so I know that I am doing the best that I can to help turn the tide of the mortgage industry. But this is also more widespread than just expecting mortgage professionals to be the only ones that are responsible for changing this. Who is going to teach the borrowers that although they may hear one thing from their mortgage lender they should still question whether that one thing is the right thing for them?

I am heartbroken for Jenn the Seller. She has been through so much in her life and having been blessed with her beautiful twins is likely bittersweet as they will have to uproot their children and move them. True, home is wherever you make it. I have no doubt that Jenn will make a beautiful home even if it is not their custom built home. But I am saddened that when they built that home it was within their reach and unfortunately they did not know enough to question their lender about how they were qualified. I am sad that they have to go through this experience at all. I know there are many more out there just like them and I wish I could do more to reach them all. I wish I could help educate more people. Answer more questions. Tell them what they are getting into. Be the realist that they need- as buying a home is such an emotional experience and quickly becomes irrational as well (I know this firsthand!).

The best I can do is blog. Tell all about my experience. Talk about what I think, what I know, what I suspect, and what I hope. Drop a line. Comment. Come back often. If I can reach but one more person through my blog then that is at least one more I can make a difference to.

And thank you East Side Jenn for helping show how this could happen to anyone.

Love, West Coast Jenn.

And we wonder why the housing market continues to decline (Jenn in Vegas- aka the buyer)

So... I am so ripped off I don't even know where to start.

In addition to playing the waiting game on the Bank of America short sale that we have been in contract for since May we have decided to pursue our other options. Our realtor (the patient saint that she is) has showed us home after home. We have written several offers on bank owned homes, some of which I have blogged about. (I think?)

Did I tell you about the bank owned home that we offered 35k above list price and didn't even get a chance to offer our highest and best? Today we found out that it closed yesterday. Any guesses on what the final sales price was? Are you thinking it must have been 40, 50k above list price? Would you believe that it was a mere four thousand dollars above list?

Our offer, at thirty five thousand dollars above list (THIRTY FIVE THOUSAND ABOVE LIST) was rejected for an offer that was four thousand dollars above list. Which means the bank LOST thirty one thousand dollars on that home. Because they wanted a cash buyer. Keep in mind, the value of our offer was fairly well supported by the comps in the neighborhood.

In turn, this means that the price per square foot in that neighborhood has further decreased from the all time low of eighty dollars per square foot to seventy six dollars per square foot. I'll bet the neighbors just LOVE this. I can now see at least three more people contemplating walking away from their homes that are upside down in that neighborhood.

Asset managers, if you are reading this- you are only perpetuating the problem. This is UNBELIEVABLE. We are highly qualified buyers with full loan approval. We even have a flippin' rate lock. The only conditions on our loan are acceptable appraisal and fully executed contract. You passed us over in greed. Or short sight. Either way, you have unfortunately further contributed to the decline of the housing market by taking a cash buyer (who will fill the home with tenants no doubt). In addition- to all those asset managers out there choosing cash buyers (investors, LLC's, property flippers) all you are doing is creating another false housing market. What will happen when the prices cautiously rise and people begin to get optimistic that the housing market has taken a turn for the better and these investors begin flooding the market to unload their booty?

What stinks about this whole situation is that we would have loved to buy that house. Matter of fact, even without cash in our hand we probably could have closed our loan this week too. Sadly they didn't even give us a second thought. And here we sit, in our short term rental, watching the market pass us by. It's like when you get to one of the highest levels of Frogger. The cars are racing by too fast for you to hop out and get across. So you are stuck sitting on the side until either your timer runs out or you hop in front of a car and end up staring at the "game over" screen.

It's Jenn #2...aka the seller!!

Hi everybody...I'm the "other" Jenn! I will be dropping by once in a while to share my experience with a Bank of America short sale---as a seller. I want to thank Jenn (#1) for letting me do this...I want to let people know what they are getting into with a short sale, and sometimes I just may need to vent!! Let me give you a little bit of history so you can see how we got to this point. We never thought that we would need to resort to a short sale! About a year and a half after my husband and I married, we decided we were ready to build a house. We went to a custom home builder where we lived, and had them design our dream home. Their original estimate on what it would cost to build the house was $184,000. After the super-slick salesman finished with us, the total of the house was $269,000. We were 22 and 23 years old, and had no conception of how much money that really was! We also weren’t thinking about things like taxes and insurance that would be added into our payment. To make matters worse, the Countrywide loan officer that worked in conjunction with the builder was as slick as the house salesman. She tried her best to talk us into one of their new “pay-option ARM” loans. These are the very type of loans that helped contribute to the housing crash. Fortunately, we opted out of the ARM loan, and decided to go with a plain-vanilla 30 year fixed loan. We found out later that loan officers get more commission when they close those types of loans. I’m so glad we didn’t do it!
The house was complete in June of 2006 and we moved in. The payments on the house started in July. Our loan payment was supposed to be $1600 per month, but once we added in taxes and insurance, plus PMI, the payment was bumped up to $1900. It was tight but we were fine…my husband and I both worked, and it took every penny to pay the bills. The crazy thing is…the Countrywide loan officer I was telling you about?? She “worked” the numbers and had our loan based on my husband’s income alone! He made $32,500 per year at the time. So Countrywide approved a $269,000 loan on an income of $32,500, and they wonder why they went bankrupt??? We were barely making it on TWO salaries, but we WERE making it. We took our obligations very seriously. Over the next several years, our payment increased to $2111, over $200 per month higher than when we started.
In July of last year, we found out we were pregnant with twins, and decided it would be best if I quit my job and stayed home. At that time, we were going to replace my income with my husband’s performance bonuses. His construction-based job pays very large bonuses based on the profitability of the jobs he works on. The bonuses he received were more than enough to replace what I made. That was all fine and good…until January of this year, when his company put a freeze on all bonuses and raises due to the economy. All of a sudden, we were faced with a problem. We contacted Bank of America many times, asking for the mortgage help that they were supposed to be offering, according to the terms of the government bailout. They were completely unwilling to help; they told us they couldn’t do anything until we were at least three months late on our payments!! We didn’t want to stop our mortgage payment….we had great credit and wanted to keep it that way. Finally, after trying again and again to get help from them, we decided that if they were so insistent that we had to miss payments in order to get help, then that’s what we would do. We put the house on the market, and stopped making payments. Gosh, its hard to even type that sentence. It goes against everything we have ever been taught. We started saving every penny from that mortgage money, and using it to pay other debt, trying to do everything we could to help my husband’s credit. The bank was still unwilling to help; they basically just kept saying they would foreclose before they would offer any loan modification.
That brings us to August. We finally received an offer on the house. The buyers knew that we were trying to do a short sale. Our asking price was $230,000 (we owed $259,000). They offered $205,000. We weren’t crazy about sending such a low offer to the bank, but that was the only offer coming in…the market in South Carolina isn’t as hopping as the Vegas market!! We sent the offer, plus every other thing they asked for on August 24th. They said it would take 10 days to get a Phase 1 negotiator assigned. When I called back, they said they still didn’t have our paperwork. Come to find out, it took from August 24th to September 9th for them to get our fax off of the machine and get it into their system. Then they said it would be 10 days from that date (Sept 9) to get the negotiator assigned. I called 9 days later, and they said to give them a few more days. When I called back several days later, they said that our loan had been transferred to the loan modification department!! No one could tell me why it had been send over there. I asked them why they were willing to modify our loan now, when we had been asking for help months before. No one could answer that question either. The lady I spoke to said that we would have to call the modification department and ask to have the file transferred back over to short sale. We did that last week, and they said that would take 3 or 4 days to get done. Here is the real kicker: once the loan finally makes it back to the short sale department, our file will go to the back of the line, and we will have to wait another 10 days for a negotiator, and we all know that it won’t happen in 10 days. I am supposed to call the bank tomorrow to see if they have the file yet. I am NOT optimistic. I will say one thing I AM impressed with is the ability that BoA employees have for bull$#!#. I think they must make all short sale employees take extensive classes on how to give people the runaround. I can’t believe I started this process thinking that maybe we would be the exception instead of the rule. I guess there is a fool born every day, huh?? I apologize for this post being so long!! I promise they won’t all be this way…I just wanted to give you a little history so you knew our story! I’ll post this afternoon or tomorrow after I call the bank!!

A Tale of Two Jenn's

Remember me mentioning that I might be able to get a guest author to blog about the Bank of America short sale process for a seller?

We are in luck!! I am so excited about this. See, everything I have researched about Bank of America short sales is only from a buyer's perspective, such as mine. Don't you ever wonder what the seller has to go through?

Not to confuse you all, but we are both named Jenn. We will try hard to identify our blog posts with something like "from the buyer (seller)" so you will know which side it is coming from. Likely you will hear a recurring theme from either side (complaints!) but at least you will have some insight as to what we are both going through.

Note- we are not involved in the same transaction. This is completely based upon our personal experiences, and we are not saying that all buyers or sellers will go through the exact same experience. We encourage you to ask questions, leave comments, or share your thoughts as well.

My heartfelt welcome to Jenn the seller- thank you for joining me!

Update to the Countrywide/Bank of America Short Sale

If you read my blog a few days ago you will know that the BPO was expected to be in on Tuesday or Wednesday. Today is now Friday.

Would you be surprised to hear that the BPO was not in on Tuesday or Wednesday? It didn't surprise me in the least. As a matter of fact, although they told us the value should be coming in this week and they would be reviewing the numbers I actually added 30 days to that as a buffer.

Let the clock begin ticking. We are now 2-3 days past their original estimate. The next follow up date is not until Tuesday. Which would put us at 6-7 days past their original estimate. See how quickly I will be able to eat up that 30 day cushion without anything actually happening?

I hate that the carrot dangles in front of us- like we are almost getting somewhere- and then it moves on. We have been in process for four months. Four.Months. fourmonths. We tend to go 30-45 day stretches where there is no news, nothing to indicate that our file is even still in process. Then they throw us one tiny morsel of an update and we get all excited and think we are moving somewhere.

Ha! Where is the candid camera? We aren't getting anywhere! It's just a figment of our imagination.

On a side note- stay tuned! Bookmark this blog and come back often. Possibly coming soon: a co-author that will give their perspective on a Bank of America short sale from a seller's point of view! The rare, elusive, seller's experience with a short sale. Are you excited? I know I am!

Suntrust Short Sale

In case you were wondering, our offer did get accepted on the Suntrust short sale as well. Actually, we really haven't wrapped all that up yet. The timelines on that property haven't been up to my standards either. Seriously, what is it with people dragging their feet? Apparently no one is in any great hurry to close real estate transactions. I would think we were back in 2004 when everyone had so much business it was like the all day buffet. They would load up their plates, leave half uneaten and throw away the remainder. I feel like the tossed out stuff.



Anyway- so we viewed the home on I think September 10th. We wrote an offer immediately (standing in the driveway) and were hopeful we would hear something definitive and quickly at that. The following day we were told the realtor had received our offer but would be waiting to meet with the homeowners until the weekend. No problem- we figured we could hold out for another day or two.



The sellers realtor came back on Monday and asked us for our highest and best offer. Huh? We offered almost 26k above your asking price? So we decided to go aggressive. We wrote that our highest and best would be $1000 above any other highest and best offer- including our own original offer. Apparently there was someone that just threw a ridiculously high number out there hoping that the sellers would take the bait- knowing that if the appraised value did not come in it would be renegotiated downward later anyway.



Lucky for us- the seller's realtor wasn't a total ego. He did tell them that he didn't feel the higher offer was realistic and that ours had clearly been the most serious one from the beginning. Plus I think it helped that we had toured the home while the seller was there. They have two small children that are almost the exact same ages as our kids.



But after hearing on Wednesday night that our offer was accepted we really haven't seen much movement. That was Wednesday the 16th. Today is Wednesday the 23rd. We just barely received the seller's signed counter offer two days ago and we still have not yet received all the seller disclosures that we were supposed to receive as part of the contract.



So in essence, we have lost nearly two weeks already just going back and forth on the original offer! I am definitely hoping that the seller's realtor (who incidentally is negotiating the short sale for them and NOT utilizing a 3rd party processing company) really is on his game and this is not indicative of the timelines we will see on this property.



Actually, I think it has been somewhat good that they have been dragging their feet on the property that goes to the Suntrust short sale. We actually had told our realtor when writing the second contract that we would not tie up the first home if we did not intend to follow through on it. We were prepared to notify the seller of the Countrywide/BofA short sale that we were cancelling escrow. It just so happened that the day after we were just about to withdraw our offer on that home we got the update that indicated the BPO might be coming in soon so we figured if we were this close we would hold out.



Right now we aren't thinking we have much hope on the original property that started this whole short sale blog. We feel that BofA is going to either deny our offer because it will be too low compared to their BPO or we will counter back to our highest and best and it still will not be high enough. I say- it's been nice to dream about that home. But I'm not going to put myself under water to take on a second mortgage - especially when we already own a home in the area that is upside down. Instead- if they do not accept our offer, or even our highest and best- then we are going to pass and know that we gave it our all. We are going to make the conservative choice and proceed with the 2nd contract we have out there- as the home is less expensive, needs less work done to make it our own, and will cost less for us to maintain in the long run. It's a tough call though- both homes have features we absolutely love. If we had the cash we would buy them both. I don't know what we would do with them, but we would buy them.

Well, if we could get a flippin' short sale approval from their banks that is.

CWY Holdings is getting their act together!!

After four months (four long, frustrating months) we finally got an update yesterday that makes sense. The update was that the negotiator had contacted Complete Short Sale Processors and let them know that the BPO was expected to be back on Tuesday or Wednesday, that all of the seller's information is in hand and that the negotiator will be going over the numbers soon.

ALL RIGHT!! Now we are talking!

We started off working with a standard short sale processor at CWY. While he was nice enough I just didn't feel that he completely understood what he was doing. Twice we received notes that the sale date was set- and yet there hasn't even been an NOD filed on this property yet.

Sometimes we were lucky enough to speak to the Grand Wizard of Oz- one of the owners of CWY Holdings. Again, always nice (placated me as necessary) but yet we didn't really feel as if we were getting anywhere. Apparently he assigned one of their account executives to act as a liaison for us. We were happy to have someone new to share our sob story with. She always returned my realtor's calls and they had good conversation but she wasn't entirely sure why she was being asked to help with our file.

Finally a few weeks ago we were put in touch with our account manager. This person had been listed on the auto-update e-mails all along and I wasn't really sure why we hadn't heard from him sooner but let me say- I just wish that we had. Of all the people we have dealt with over there I have felt his e-mails have been the most forthcoming. It seems he has the most realistic handle on what is going on (whether it makes me happy or not) and honestly, I am a realist. Don't sugarcoat things for me. Don't tell me what you think I want to hear. Shoot straight, even if it is not the popular answer and at least I will respect that.

Sometime in the last four or five days they have also involved their Director of Loss Mitigation for Complete Short Sale Processors. I don't know who this lady is but where has she been for four months? Maybe it is just that the file is at the tipping point and things are going to happen regardless of how much involvement the short sale processing company has but hey, in just four days all of a sudden the job is getting done over there.

Are we happy? YOU BET... Now, we are just hoping this whole story has a happy ending. Of course, that could still be three to four months away but we will see. Hopefully, maybe, possibly we will have some sort of information this week if our offer price is what Countrywide/Bank of America will consider "fair market value". I mean, it was when we made the offer, but it has been four months. And if it had decreased in value you bet we wouldn't be complaining- but if it has increased we just can't go any higher. So anyway, stay tuned.

Today's update from CWY Holdings?

Nothing. Not a thing.

Yesterday they informed us that if the sellers updated financials were not received by Bank of America within 48 hours the file would be closed. They noted that the next follow up date would be today. We received no notification via their QuickBase system that any follow up was done.

Now, one would assume that means they did not follow up. Likely tomorrow they will reply to my realtor's e-mail with some explanation that they really did follow up but forgot to update the notes.

By all rights tomorrow is D-day. Tomorrow is 48 hours and if Bank of America does not reflect that the seller's updated financials have been received then technically tomorrow the file will be closed.

My husband didn't seem fazed by this. He said "Fine, let them give us our earnest money back then so at least we can move on our merry way."

I say, if they close the file after we have been in escrow for four months, after we have moved out of our home into a rental because we have found tenants, after we have waited, and waited and waited I will be ripped off. RIPPED OFF.

Not because we aren't already pursuing other possible options (none have come through at this point so honestly we still have all our eggs in this basket) but more because I was so innocently optimistic about this file from the get-go. I naively wanted to believe that all those horror stories that I read on those chat boards were just vindictive people who were probably ill-informed about how the process was going to work.

Now who's the pot calling the kettle black?

Four months ago I believed that we might be able to close this short sale within five months. I hoped that we would be living in the new house by Halloween- my all time favorite holiday. Now we will not be living anywhere but our rental for Halloween - and possibly Thanksgiving and Christmas too. All of our holiday decorations are packed up in a POD and it isn't even as if I have anywhere available to decorate in our rental as we have every corner crammed with stuff that was too valuable to risk packing in a storage POD.

Not to sound jaded or anything, but we don't even think that this Bank of America short sale will ever go through. We feel we could wait out three or four more months and possibly still not get short sale approval. It isn't for the fact that it is a short sale- I mean, in our line of work we are seeing short sales approved and get to the finish line all the time. It's just that for every ten I see close maybe only one of them is a BofA. And for that one BofA approval I can also see a contract that took at least seven months to get to the finish line. If only I had known this when we wrote the contract!! At that time I had no reason to have tracked any sort of short sale information for loans that we were closing. I mean, I saw short sales come in the door, and I saw them close.

Again, I was naive. I was optimistic. I am over all that. I just want to move on- I just want to find some permanent closure to this terrible, terrible home-buying experience. We are hoping to hear tomorrow night on the other short sale that we wrote an offer on- and insanely we are hoping that they will accept our offer.

As if we haven't had our fill of short sale nightmares.

Countrywide Short Sale Update

We were notified back at the first part of August (the 6th or 7th I think) that Countrywide/Bank of America needed updated financials from the seller in order to move the file on. (Move it ON? Don't you mean, move it at all?) So specifically the notes we received from CWY Holdings was that nothing would be done on the file until the seller financials were received. No BPO would be ordered. Nothing.

Then we got some information about a week later that the seller did indeed comply and sent all items to the bank, they were just waiting for them to show in the system.

Every single week since then I have asked "Why aren't the seller's financials showing up in the system yet? When are they going to re-send them? How long should they take to show up?" The responses I have received have varied but mostly are generic and something to the effect of "the bank has them, they are just backlogged with imaging them."

Today we got this update from the short sale processing company:

"I received a call today from the negotiator today asking for bank statements and paystubs for June and July. She said that she must have them in 48 hours or would close the file. I told her that I had sent those previously. I re-sent them and asked her to let me know if they are sufficient or if she needs more.

While I am waiting to hear from her, I recommend that you send any bank statements dated later than July 21 and paystubs after July 24 so that we can keep the file as up to date as possible."

........................Clearly they haven't been following up on exactly WHEN that information should have been located in the bank's imaging system. All of a sudden today they are telling us that the information never made it to imaging and the file will be closed within 48 hours.

Keep in mind, we are not the sellers. We are the poor innocent bystanders just trying to purchase this home from the bank before it becomes a vacant, vandalized liability. If I could be the processor on this file myself I most certainly would. See, what the banks fail to care about is that right now not only the financial well being of their borrower is at stake- so is the financial security of my family. So short saling is not only about one family, it is about two.

I promptly e-mailed my realtor back and told her I was sure glad we weren't leaving all our eggs in this basket and that I was also glad we were already pursuing other options. Can you even believe we have waited four months, moved out of our home and rented it to tenants, and turned our lives upside down to be told that the file could potentially be closed within 48 hours for incompleteness?

And what I want to know is, if the negotiator could pick up the flippin' phone to call and tell the short sale processing company that they never received the information and were closing the file, why the hell can't they get the file reviewed and moved on before everything had expired? I mean, thanks for the courtesy call and all, but maybe, just maybe, if you all had reviewed the file when it was first submitted BACK IN MAY you could have just gave us a simple "yes" or "no".

That's all. A "yes" or "no" would make all of us real happy right now. Instead we get the run around. We get no response. We were once told a staggering statistic about the INS (yes, Immigration and Naturalization Service). We were told directly by an INS Border Agent that the INS actually loses one in three documents it receives.

Loses them. Gone. Poof!

He suggested that we only send our correspondence to the INS via certified return receipt mail. It was sound advice. Apparently Bank of America/Countrywide operates along the same principals. Maybe they even share a PO Box! Now there's a thought.

Seriously, I have heard all about this new streamlining process. Supposedly the government has tried to offer incentives and rewards for big banks to get the job done quickly. Bank of America has over 450,000 short sales in process and is receiving 10,000 new requests a day. Each case manager is managing hundreds of files. They are overworked, underpaid, and poorly trained. They have no authority to really do anything so they pacify you by telling you that your file will be escalated, which is code for -nothing.

Four months ago I was an optimist. I believed that the short sale process would take us about five months or so and we would then be closing on our beautiful new home. We thought we were so lucky that the sellers chose us above all others to go into contract on their home. We made plans, we executed those plans, and now here we are sitting in limbo.

For any mortgage underwriters out there wondering why someone would really do this let me just say- it is all for my children. I want so badly to provide a safe place for my kids to play outdoors that I have given up everything they have ever known and have put my family through the wringer. Yes, our golf course home was beautiful. Maybe we could have raised our children there without incident. But maybe we couldn't. Maybe another ball would come smashing through a window despite our golf screens that we invested in after the last crash. Maybe a ricochet ball would hit one of the kids as they were playing innocently outside.

I hope that one day I can look back on all of this and laugh but as of right now all I can do is type furiously and hope that our experience might reach another buyer out there. I want to tell any other buyers the same thing I read but did not believe- a short sale with Bank of America (Countrywide) will be anything but short. It will be anything but easy. Good luck getting it closed as I am not even sure at this point that this one will ever close. (do as we are doing- and start looking for plan B!)

The next update on the Countrywide short sale is tomorrow. I am certain I will be blogging about it so check back soon!

The Queen of Short Sales

We have not yet found out for sure if we are going into contract on the 2nd short sale (the one we put an offer in last Thursday). Today we got notification from the listing agent that they wanted to know our highest and best offer.

What do you mean our highest and best? We gave it to you? We offered almost 27k above list price. What more would you like? Not to mention today you sent us this lovely addendum detailing out a few things that will be removed from the home before we purchase it. Namely, all lighting fixtures and ceiling fans, all stainless steel appliances (dishwasher, microwave, cooktop, double oven, fridge, and hood vent), the wrought iron courtyard gate, and all shutters.

You want our highest and best? Subtract fifteen thousand from our offer. That's our highest and best.

I only wish I was gutsy enough to tell them to do that. Instead we wrote an offer that our highest and best would be to top every other highest and best offer by $1000 (including our own original offer!). Can you tell we kinda want this house? We just really want to be done with this homebuying experience.

I blogged about three months ago about how it all seemed to fall right into place and therefore that must have meant that it was all meant to be. Now I wonder. It has all fallen into place- if we want to live in a rental home for the next two years while our tenants enjoy ours. Or if we want to drag our children from viewing to viewing trying to get in and see homes before they have been on the market for more than 48 hours.

As of right now we are on hold to find out if we are going into contract on the Suntrust short sale until at least Wednesday. The listing agent wanted to give all parties an appropriate amount of time to revise their offers before submitting them to the sellers.

What I really want to know is, why on earth would they be worried about getting highest and best on a short sale? We were led to believe that our offer was heads above the other offers they received. The seller stands to gain absolutely nothing over starting this little bidding war. If they garner an extra five grand out of the deal it all goes to the bank. A short sale is a short sale. It is my understanding that they are several hundred thousand dollars upside down on this house- is five or ten thousand going to make or break the bank?

Instead they are wasting precious time dickering back and forth with the offers they have received. They had a notice of default filed at the end of July- which means that they will likely be going to trustee sale sometime late November or December. I certainly hope that we get this contract and that we can get through the short sale process before their sale date comes up! We have been told that the sale date would just be postponed if their short sale negotiator did not have time to complete the file yet but we really don't want to drag this on either. We would really like to be in our home before Christmas. After all- Santa really wants to bring the girls a swing set- and he just can't leave it at our rental. (no room to even store the boxes!!)

Stay tuned. We will hopefully know by Wednesday night if we were the lucky lottery winners or if we are back to ground zero.