One of our associates is representing a buyer in a short sale where both a first and a second mortgage holder must approve the sale. The existing first and second mortgages are held by different banks, and as sometimes happens, the first and the second are completely out of sync with each other.
The listing agent completed a thorough, detailed short sale package and submitted it to both mortgage holders.
The first mortgage holder approved the package promptly. The second mortgage holder, Bank of America (need I say more?!), just didn’t get around to it.
Bank of America procrastinated, and procrastinated, and by the time they finally got around to reviewing the file, the first mortgage holder said, “Oops, sorry, too long, we’re closing our file, you guys will have to start over from square one.”
Since, I suppose this is a fairly common problem, I’m wondering what strategies (if any!) other folks are using to keep two different short sale lenders in sync?
Our associate took a a “top-down” approach. Here is a portion of the letter she sent to B of A’s VP Customer Advocate, Nancy Condos, and B of A’s Chairman, Kenneth Lewis, in an effort to shake the trees:
Dear Chairman Lewis and Vice President Condos:
I am writing this letter to request your support on behalf of my Buyer – Buyer N.
Here is the timeline and dire circumstances that have lead me to ask for your immediate intervention.
- Offer written on behalf of Buyer N. for $275,000 – July 21, 2009
- Offer accepted; processed by Listing Realtor D. for submission to both lenders.
- Negotiator of the first trust deed is HomeEc Mortgage Servicing.
- September 16, 2009 HomeEc approves the short sale in writing.
- Buyer N. and Selling Agent’s team jump into immediate action; obtains full, doc-ready, loan approval within 5 days following September 16.
- HomeEc’s approval is subject to escrow closing by September 28, 2009.
- As the September 28 date loomed, Listing Realtor D. makes every effort to be in constant contact with B of A negotiator. He is told that the written short sale approval necessary to order Buyer N.’s loan documents is forth coming “within 48 hours” – that commitment was made on and off for two weeks.
- September 28 passed and HomeEc told Listing Realtor D. that the file was being closed and if/when the second mortgage holder (B of A) issued the written approval the short sale process with them would have to begin from step one.
- On October 1, Listing Realtor D. spoke to the B of A negotiator, T. – who explained to Listing Realtor d. that the “process” was in phase two and she is allowed per B of A guidelines – 30 business days to issue a written approval/authorization.
- During this entire process, Listing Realtor D. has emailed and left voice messages for Negotiator T., and her Supervisor, S.; Negotiator T. rarely returns calls or emails, and Supervisor S. has never returned a call or email.
The consequences of this mayhem are:
- Buyer N., a Los Angeles inner-city elementary school teacher remains in escrow limbo, if this escrow does not close by the end of November, Buyer N. will forfeit the opportunity to apply for the $8,000 first time buyers tax credit. Buyer N. has done it all the right way. Saved for the down payment (20%) plus reserves, has excellent credit scores and no debt. A dream client for any Realtor.
Here is a partial list of the people that are financially impacted by the direct conduct of Negotiator T. and Supervisor S.:
- Two Real Estate companies, Realtors and support staff
- Escrow company, Officer and support staff
- Title Company Representative and Officer(s)
- Buyer’s Mortgage Broker and support staff
- Buyer N. who has paid for the property appraisal
- Buyer N. who has paid for the physical inspection of the property
- Buyer N/’s actual lender via the Mortgage Broker
- Termite Company who has completed the remediation
- Home Warranty Representative and company
- Natural Hazards Disclosure Company
- Home Owners Association and staff
- Buyer N.’s homeowners insurance agent
- HomeEc Mortgage Servicing
- The current owner of the property
- and Bank of America
Due to the inability to formally issue the B of A written approval ($3,000 net) not one of these professionals and/or their companies will get ONE CENT …not one – including B of A. All of our time and hard work is deemed valueless because of the holdup of this final written authorization.
On behalf of my Buyer N. and my many professional colleagues – how long does it take to issue an approval in writing?
My plea to you – is to urge the issuance of the written approval immediately. The impact on this one file is enormous – step back a moment and ask yourself – how many files are in this same limbo – how many Realtors and related professionals have worked – to be held off until their clients are forced to cancel – the homes are lost to Trustee’s Sale. A directive from your office will solve this one crisis – please take this action. Think back to when you bought your first home – how proud and thrilled you were – don’t deny Buyer N. this joy.
Sincerely,
