Life in Newtown, CT: February 2012

Short Sale Mayhem and Other Nonsense

Short Sale Mayhem and Other Nonsense  We have been active in the short sale and foreclosure market for a few years now.  We've run across many stories and many circumstances, but this one takes the cake!  We'll call it ... Short Sale Mayhem and Other Nonsense just to sum it up.

In January, we were contacted by a homeowner who wanted to list his home for sale.  He had recently received a letter from his mortgage company saying that if he short sold his house, they would pay him $2,500.  This came as quite a surprise to him as he thought his home had been foreclosured on 14 months before!

That's when we started to ask questions.  14 months prior, he had received a letter from the mortgage company notifying him that he had been foreclosed on and it directed him to vacate the premises immediately.  Which he and his wife did.  They packed up their most precious items and moved in with their daughter.  They declared bankruptcy and never looked back.  Never went back to their house.  Never checked on it.  They had been told it was no longer theirs and they took the bank at face value.  Keep in mind that this was back when robo signing was in the news and many foreclosure actions were put on hold.

So, imagine his surprise to receive a letter from the mortgage compnay to short sell the house 14 months later.  Last winter in New England was awful.  We had massive amounts of snow.  A hurricane hit this area in September and in October, we had a Nor'easter that dumped snow on us before Halloween.  Surprisingly, the house was in pretty good condition considering it had been neglected and vacant for so long.

We listed the house for sale and contacted the person in the letter sent from the lender.  We forwarded the Third Party Authorization form as directed.  The lender's appraiser contacted us and we let that person in.  This is when the real fun began.

A week after the appraiser was at the property, we call to get the list price (as per the bank's guidelines).  The case has been reassigned to another person and then it was reassigned to another person - 1 person per week.  The last person acknowledged having the Third Party Authorization form in her possession.

We put our lockbox on the front door with the original key from the homeowner.  Another Realtor called us a week later to let us know that the bank's preservation company was at the house cutting the copper pipes out in the basement.  When we checked on the house, our lockbox had been removed, the locks changed and the preservation company had kicked in the french doors to gain access to the house.  We won't even talk about the items that the preservation company removed from the house!

The next round of phone calls began to the lender to tell them what their preservation company did to the house.  Unfortunately, they were unable to speak to us as they couldn't find the Third Party Authorization form.  That took several hours of our time and we got absolutely no where. 

One of our phone calls had been to the negotiator - who let us know that they had a list price.  That took the bank 4 weeks from the time that we let the appraiser in to the house to arrive at the list price.  The negotiator told us that she would send us an email with the information.

We posted on our Facebook fan page about "mass frustration with XYZ bank short sale department".  Our posts are automatically posted to Twitter.  We were contacted by a nice man named John whose job is related to social media complaints for the bank.  We told John our tale of woe and he didn't seem to fully understand everything.  What he did do was notify us that there was an email from the negotiator in the Equator System.  That was the first time that someone at the bank had mentioned Equator.

So, we got our list price and had 72 hours to upload the listing agreement and the MLS print out into the system.  We did this; however, we couldn't access the house as we have no key.  After uploading the Third Party Authorization form into the system, we thought we were free and clear to now get a key.  Not so much.  The bank then next required an email from the owner telling the bank to send us a key to his house so we could short sell it as the bank requested.

It's been 2 days since the key was overnighted to us.  The Fedex tracking system says:  Feb 20, 2012 4:31 PM:  Shipment information sent to Fedex.  We are starting to wonder if the package was actually picked up.

Ah, the joys of short sales.  The damage the preservation company caused to the house still has not been addressed.  The bank doesn't seem to care about it.  We've decided to focus our energies on getting the home sold for our client.  Just need that key ...

Short Sale Mayhem and Other Nonsense - that is how we will remember this one.  It's the worst we've ever run into.  Bizarro World at its best.  The bank should be ashamed of themselves for how they have treated this home owner.  No wonder short sales are so difficult.

The Wards & Riley, the Real Estate DogBob and Richelle Ward
Coldwell Banker Residential Brokerage
Bob's Cell: 203 470-9818  l  Richelle's Cell: 203 470-9819
Facebook  l  Website  l  Blog

Comment balloon 42 commentsBob and Richelle Ward • February 23 2012 05:10AM
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