All Forum Posts by: Charlie M.

No worries. Good luck! I would love to assist you but I'm in FL. If you would like pm me on fb and I will find an agent for you in NY. 

Research the agent. Find a new realtor that is new to the real estate. They have the drive and motivation to do their best. 

I will go with the "Are they just going to squat" theory.

When the bank goes to foreclose they are often told to "try and short sell it". They get an agent and put in their hardship paperwork and that holds off foreclosure for a period of time while it is trying too be sold.

So if you are waiting for the bank to foreclose and it is getting close and you can throw an additional few months to a year of mortgage free living by having it for sale..... some choose to do that. If it actually gets sold it can end this whole gravy train in 60-90 days. If not by the time the bank gets back around to looking at it 9 months may have passed. Then they have to actually start the foreclosure process. You can fight to get in and submit a bunch of low ball offers etc, but the people who can let you in will most likely avoid you until the bank calls again and says "tough we are foreclosing on Wednesday".. then you will get a call to come have a look.

Hire a buyer's agent. You will not lose but get help. They buyer's agents are paid by the seller so you won't have to pay for commission but rather get help. Use a realtor, it's to your advantage. You just have to find a good one to assist you with your purchase. Listing agents work for the seller so it will be against your best interest. 

Getting the owners to agree on price and terms with the short sale is only half the battle. You have to get the senior lender, and junior lenders, and all lien holders to release their interests. They will all fight for every cent they can get taking a loss on the debt owed.

A lender or their asset manager for the loan would usually rather do a loan workout to get performing again rather than take a big loss with a short sale or foreclosure. Especially if their is mortgage insurance the loan servicer will need to demonstrate and document they did everything possible with workout options to get the loan performing again before going a short sale or foreclosure route otherwise mortgage insurance will try to deny the claim.

Owners typically will want to milk as mentioned every free month they can get. Some have lived in houses for years before moving with foreclosure. Many could care less when they are staying rent free on a mortgage they are not paying to get 3k to move when security deposit, advanced rent at new place, and moving costs in an expensive area could cost tens of thousands to move. 

If sellers credit is trashed already they could care less about workout options. You could get through short sale almost ready to close and owner could file chapter 13 to delay things further. Owner early on if not in BK could be excited and motivated to do a short sale. Then when servicer asks for financials over and over again from home owner and keeps making the process difficult eventually the seller mid process gives up emotionally and the short sale fails.

With a short sale you have to figure out what kind of loan it is FHA,VA, conventional,etc. What options for a short sale vary by type.

Charlie M.

Like the other poster mentioned, this is a common problem with non-responsive owners.

You can't get in to see most shortsales in Queens and Long Island.

They aren't interested in having people waltz through a bad time in their lives. And, there are some owners that are just trying to delay the foreclosure process as long as possible.

There are also some agents that are notorious for having listings that are drive by only, no contact with agent. Offers submitted through an email address and only accepted offers get to move to next stage. Waste of time.

You have to guess what the problem is, and address it.  It could be one of the following:

1. Borrower thinks it will owe taxes if there is a short sale. That is almost never the case, and there is a simple way, on the front end, to tell if they will owe taxes or not.
2. Borrower is stockpiling money for moving expenses.  Most do not know they can get up to $3,000 at closing to help with moving expenses. A quick phone call to the lender, ahead of time, will reveal if this is available.
3. Borrower knows that foreclosures often take a long time to execute, and it's better to stay in the house until the bitter end, and then take $2,500 cash for keys after the foreclosure. Not everybody offers that, though, and they will not tell you in advance, for obvious reasons. This is a tough hidden objection to battle.  You need to explain that they can get the $3,000 with a short sale (usually.) You should explain the consequences of staying the house until after foreclosure are:
   • When they go 30/60/90/120 days past due on mortgage, their credit score declines. Then it starts to rehabilitate slowly if they have other credit they are handling responsibly.  At some point in the future there will be a foreclosure, their credit score will crash again, and they will have to start all over rebuilding it.
   • A credit score rehabilitates faster after a short sale than after a foreclosure. That is how the scoring algorithms work.
   • They are in "time out" for federally insured mortgages for a longer time period after a foreclosure than after a short sale.
   • In many states, a foreclosure results in a deficiency, for which the lender can sue. The lender rarely sues, but instead bundles and sells those deficiencies to collection agencies. Not only do the agencies have aggressive collection tactics, they sometimes file suit.  Some are bought and sold several times over the years. Often, every time a deficiency is sold to another agency, it gets reported as a new bad debt, and crashes the score again. It takes a lot of time and trouble to straighten this out. Bad credit scores affect the ability to borrow money at all, what interest rates offered if someone can borrow, the ability to get insurance at all from some companies, the premium rate if they do get insurance (premiums can be as much as double normal, with bad credit) and the ability to get certain jobs.  A poor credit score means most of the nicer rental communities or houses will not accept you.
   • While it was at one time not a stigma to be in foreclosure, the economy has largely recovered, albeit not as robustly as pre-2008.  Someone who is foreclosed upon now (a public event, because of the newspaper notices and the real estate agent yard signs afterwards) will be stigmatized by at least some of their friends, relatives and co-workers. A short sale is private.
   • Waiting for a foreclosure to happen is very stressful. That affects relationships, plus job satisfaction and performance. If there are children in the home, constant stress in the home can change their entire futures. Stress causes physical problems such as depressed immune systems that can make one vulnerable to infections, flu, and even cancer. Our bodies get cancer cells all the time. A healthy immune system takes them out all the time. With a compromised immune system, the cancer cells can get a toehold, and then turn into something bad.

Good luck!

Apologize and see if the agent really got a listing contract. Low ball is often brushed by the wayside. Ask the listing agent what price you have a chance.

During 2008-2010 I submitted several short sales as a realtor through same office we never heard from lenders even today.  One came back they want $15K negotiation fee. My client declined. These homes got foreclosed and have changed hands several times. Short Sale is not a sure thing 30% successful.

Charlie M. Unfortunately this is far too common of a scenario with short sales. Having a cooperative seller/owner is a huge piece of the short sale maze that really helps especially if this is first one. There are plenty of deals out there so keep on hitting them hard and you'll get one to stick. Plus that short sale house will be popping back up a foreclosure it seems here in the near future for you to grab it.