Today I find myself writing this blog to relieve the stress of dealing with a bank on a short sale. Now I believe that just about everyone understands that Short Sales are difficult. They are difficult on sellers, buyers and agents. This short sale however is not only difficult, it just won’t go away.
In May of last year we took a listing. It was a short sale and the owner was very concerned about the time it would take and the toll it would take on her life. We received an offer in June and submitted the package to the bank for approval. We toiled for 5 months with the bank and got re-routed, re-started, re-negotiated and just regurgitated until in December we caught a break.
My client, the seller, met a lady that knew someone that knew someone else that might be able to help us. At first I thought it was just a hoax to get my client to send a check to someone, but it wasn’t. The man we found out was a big shot at the bank and he looked into the deal and got it approved in about 48 hours.
We proceeded to closing with great haste as we thought we were just dreaming and didn’t want the bank to re-something to us again. The good news is the deal closed in December. You would hope this story would end at this happy albeit drawn out point. Unfortunately it doesn’t end here.
Just today 1/25/2010, I get a call from the buyer’s agent. She is panicked and doesn’t know what to do. The buyers have received a letter from the bank telling them that the home is going to be auctioned on the courthouse steps on February 12, 2010. The buyers naturally told the bank that they had just purchased this home from them and they paid cash. The bank told the buyers, they must be mistaken and they should bring the account current or suffer the consequences of a foreclosure. The buyers spend the better part of the day talking to various people at the bank and trying to get them to understand that they are making a horrible mistake. The bank continually reminds them that they need to get the balance paid or suffer the ordeal of being put out on the street.
When the buyers agent called me to tell me this story, I let her know that I wasn’t sure what we could do, but we would certainly try to explain the situation to the bank and get them to understand. I had heard of a similar circumstance from a colleague, but I wasn’t really certain what to do. We called earlier today and they sent my assistant on a wild goose chase of transfers and disconnects. I then called the bank myself and was subjected to the same typical re-routing. I eventually got a person to actually listen to the situation. She then, to her credit, got her supervisor involved and I got to have a civil conversation with a person that would save them from terrible embarrassment, not to mention potential litigation.
The supervisor dug into the file and discovered that the negotiator that was handling the Short Sale never closed the file. She never let anyone else know that the money was received and the home had been recorded in the new buyers name. This is the same negotiator that dragged the process on for more than 5 months with no progress. I know the banks have it tough with so many people attempting to sell their homes as short sales, but they must be more professional, and they must be at least efficient enough to actually close a file properly and not subject a buyer to this kind of scare.
The buyer is very relieved and actually having a good chuckle about it now, but I would be willing to bet the bank wouldn’t be laughing had they actually sold the home again and put this owner out. I bet the bank would have been subjected to a significant financial hardship of their own.