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I have a question if anyone can help. My wife and I received short sale approval in writing from the bank. The approval letter came back with the wrong buyers name on the document. The bank apologized and said they would correct it about a month ago. Nowe the bank has decided not to honor their agreement and has not sent the paperwork with our name. We agreed on 258000. Now they are saying they want 291000. Can someone please clue me in on what the hell is happening? How in God's name can this happen? I am ready for a mental breakdown.
The owner moved out in May and put the house on the market as a short sale. Unfortunately, he picked an agent that is based in Los Angeles, and not familiar at all with the area. The SA has nearly lost his license due to committing mortgage fraud back in 2005, and has horrible reviews on yelp, mostly for not communicating with anyone, and to this date, has lived up to his reputation He has set himself up as a 'one stop shop' for short sales, with an in house escrow company, and mortgage company. If I didn't like the house so much they had listed, I would never deal with these folks. We are lucky to get one email a week, and only because my REA bugs them.
The other bad bit of news is that the mortgage is held by US bank, but serviced by SPS. SPS is notoriously difficult to deal with. Given what I have seen of our 'negotiator', I get the feeling this will be a long slog.
Here is my time line so far:
15-May-16 House listed for $324k
18-Jun-16 toured house, made offer of $325k
22-Jun-16 Seller accepts offer
23-Jun-16 Earnest money deposited in Escrow
8-Jul-16 Bank Requests proof of funds
13-Jul-16 Bank Reviewing offer
10-Aug-16 It came to my attention that a notice of trustee's sale has been recorded against the property. The auction date is set at 7 August! However, no notices have been posted on the property, and nothing has been published in the local paper. The county still shows the seller as the owner. SA assures us that while we are still in escrow, the auction won't go forward.
12-Aug-16 Received preliminary title report. No surprises excetp for overdue HOA fees. Taxes are up to date, and there is only one lien holder.
1-Sep-16 Bank requests updated proof of funds.
1-Sep-16 due to lack of information, we decided to with hold the bank documents until we got some kind of assurance that they were indeed moving forward with the sale. To this date we have gotten nothing from the bank. The SA is horrible about returning emails and phone calls, so we are wondering if we are being scammed. Our agent finally talked to the in-house negotiator, and assured us things are going forward. SA even threatened to start marketing the house again if we won't send documents.
5-Sep-16 All documents up to date, now we are told that the file has moved to underwriting. Hope to hear something by the end of the month.
The only reason we have been able to wait this long is the fact that we have enough cash on hand for a down payment, and enough income to qualify for a new mortgage without selling our existing house. Right now, if a house came along that was comparable, and not a short sale, I think I would jump on it.
Here is my timeline on a short sale i'm patiently waiting on.
Home is listed at $740,000
On the market for over a year.
7/1/2016 - Contacted listing agent and went to see the home. We loved the home and decided to make an offer after the holiday.
7/5/2016 - Made an offer at $695,000. Sellers approved same day.
7/6/2016 - Listing agent asked for Proof of funds. Sent same day.
7/22/2016 - Listing agent asks for Net sheet(?) tells us we should hear back from bank in 5-7 days.
7/31/2016 - Listing agents asks for POF again.
8/18/2016 - New appraisal is done on the home.
8/31/2016 - Listing agent contacted bank....still no news.
9/2/2016 - Appraisal came back on the home at $765,000. Listing agent tells us bank wants at or close to appraisal price. Our offer is firm at $695,000. Tells us sorry, so we decide to move on.
9/12/2016 - Listing agent contacts us and tells us that the bank may consider our offer. Highest we say we will offer is $700,000.
9/13/2016 - Signed price change addendum to $700,000. Sellers sign the same day.
9/23/2016 - Underwriter needs to review our offer.
9/30/2016 - Listing agent asks us to send another pre approval letter because numbers aren't matching up after we changed our purchase price.
This is where we are at right now.
The listing agent doesn't really give us too much information. We have to contact her and ask what's going on most of the time. She is also very good friends with the sellers living in the home currently.
This home is in a great neighborhood with great schools, built in the 2000s, and in pretty nice condition, but the listing agent has told us that there hasn't been much interest in the home. We are currently the only offer the bank has on on the home right now.
We are hoping that it works out, but seeing the appraisal price and our offer price...we aren't too sure the banks will accept. At the same time though, seeing that they haven't rejected us yet and are asking for more documents makes me wonder if they will actually consider it? I'm dying to know and getting exhausted waiting!!
Wondering if anyone has experience offering under appraisal price and getting their short sale accepted?
Last edited by eekonuy; 10-03-2016 at 12:32 AM..
Reason: *
Area: Northeast CT
List Price: 196,500 (3br,2ba cape built in 2011)
Last purchased: 2013 for 194,000
Offer: 180,000 w/ 5k towards closing
Wells Fargo short sale
July 26 - offer made
July 27 - seller's accept
August 1 - documents sent to bank
August 7 - bank acknowledges receipt
August 11 - REA/LA states appraisal scheduled for Monday 8/15, things are moving quick on the bank's side AND looking at a 5 day turnaround period for a decision on our offer! Keeping our fingers crossed
October 12 - Offer accepted!! Not quite the 5 day turnaround, but 2 months is still not too bad! Our lender already has all the loan paperwork complete, now they just need to do their appraisal!
October 17 - Home inspection day! We were told the sellers have already found another place to leave so we are keeping our fingers crossed that they are all moved out already
12/11 Offer submitted for 278k + 1% atty fee
12/17 Offer accepted
12/18 Sign BofA non affiliated paperwork
12/19 Agent has list of paperwork to fill out at the ready as the seller's agent stated the short sale ahould be quicker.
12/21 Waiting on bank.
Update 1:
1/4/2016 - Lots of updates today. My agent sent me a form that had a misspelling to initial next to the correction. Also received appraisal which came in 2k over my offer price (thankfully). Lender informed me I was approved through underwriting and requested two more forms (401k documentation for withdrawl and hazard/flood insurance information). The lender stated once bank approves offer they will be immediately go full steam ahead.
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Update 2:
1/11/2016 Bank countered for 2k above to make it 280k which is our appraisal price. It also happened to be the highest we would go. Accepted offer and just sent over paperwork. Our agent also threw in language on 3 small items that must be fixed prior to the appraisal being valid (electrical wall plate, broken fence board, and a trim piece that has to be replaced). Our agent talked with the seller and they seem willing to fix those things to get this finalized. Will know before 5:00pm PST about how these will be fixed.
Update 3:
1/18/2016 - Bank replied and stated no credit and 280k is the price. Signed acceptance and signed addendum.
1/20/2016 - Signed another addendum removing credit request. Agent told me now we just sit and wait. Waiting does suck. The worst part is I am free to look at other properties and I can cancel my contract if I want (agent said I literally could find my dream house and send an offer). But the sad reality is no other house comes close to what this offers (no hoa, nice design, dual/seperate master bath sinks). The outside is perfect and has a lemon tree. There has only been one other property for about 300k that I had interest in but it had a smaller backyard. It did have 100 more sq ft... but it seemed to be the only positive. It had terrible carpet colors and bright paint so we'd have to drop another 10k into it to change those as I cant stand it. The current one I am waiting on needs carpet and paint but is priced at that point. We are really not wanting to go over 290k for our loan.
Update 4:
1/26/2016 - Agent told me late in the evening that he talked with seller agent and negotiator stated approval "coming soon". Not sure if that means days or weeks sadly. But we did get to see the house again. Imagined all the upgrades we would make.... and reminded us why it is worth it to wait.
Update 5:
1/28/2016 - Agent calls me with good and bad news. The good news is BofA approved the short sale. Bad news was there is a 2nd on the house. My agent told me he confirmed that he and the lender asked about any other issues or loans that may be on the house. He shared the disgust for me and for the shady nature of the non-disclosure to the seller's agent. So, if this falls through... not sure of what legal steps that I possibly could have but the seller's agent should have disclosed it as it's been listed/buyer process multiple times. Very frustrating... however, my agent told me he still feels good about the transaction that the seller's agent knows her stuff and has sold a lot of short sale properties.
2/1/2016 - Got permission from seller's agent to perform fixes required by my appraisal for it to be valid. Fixes only took an hour. Most of the time was going to Home Depot to get color matched paint for the small items I had to fix on the exterior. Re-appraisal was ordered and should be done by the end of the week.
2/2/2016 - In a holding pattern again until we here back from the 2nd (Citi). The 1st approval has about 45 days left until it expires. My lender stated they are on track to close in about 25 days once we get the 2nd approval so it gives these guys about 3 weeks to get the nod from Citi. Not sure how the 2nd mortgage issue works out with the banks/seller side if anyone has info to provide. Still looking at other property but nothing comes close to this house in the area I want.
2/9/2016 - Got reappraisal back and it's solid. Apprasial is good for the 280k.
2/10/2016 - Got a notice that the 2nd approval was given but I guess Citi lives in the stone age where they only send out approvals via regular US mail? So apparently once the hard copy arrives to the seller we are officially good to go. Agent setup inspection for 2/18/2016 (pest and home inspection both occur that day). Loan people were given the nod by my agent for this information and they stated once the hard copy is in hand they will have a firm date for closing and said my file is golden and ready for action. My agent said its about a 99% deal but having the hard copy approval in hand is paramount so he doesn't like saying it will happen at 100% until its in hand. But this is the best news. The market is really on fire right now too so prices are going wild here and I'd love this to close as we would get instant equity not including the flooring/paint/upgrades we already are getting in motion.
Update 6
2/16/2016 - Postponed inspections as we still don't have the 2nd approval hard copy. We have continued to look for properties and I feel like we will end up settling for less and paying more. Honestly, if the seller's agent was up front about the 2nd we would have been way more understanding about the time frame. Instead, now we doubt they actually got the approval from Citi and are just stringing us along... my agent still thinks it will get done because the seller's agent (he reiterated) has done a lot of short sales. He said if we can get the letter before 2/26, he thinks the lender will close before the 1st approval expires on 3/15.
2/19/2016 - Still haven't seen the letter. Hoping it magically appears today but we will be heading into the week ahead still waiting. Houses are selling for about 5k over asking and, really, these houses we continue to see are terrible haha. It's no wonder they are selling.... So I sit here Friday morning hoping for a phone call from my agent telling me we have the 2nd approval letter.
Update 7
02/23/2016 - Asked my agent if he had talked to the listing side and he replied the listing side would inquire. Later that day, he replied the seller's agent stated there was a technical issue on Citi side and the seller's agent will follow up to get find status of hard copy letter. In the evening, I talked with my agent for about 20 minutes to go over everything. I told him the seller's agent seems like the type that won't deliver and just says things to keep us from leaving. I asked him to lineup properties to view as I am tired of the games. I also talked with my lender about spending more and he said we could afford a pretty big cost (which I wouldn't go to the higher end though I can't afford it) and told he me, point blank "it's a shame this short sale is stuck right now because our in-house people have your file ready to go. There are zero issues with your file. Credit is flawless, down payment is covered, account details are where any underwriter would want to see them."
02/24/2016 - We have four properties to view at lunch. I think we (my girl and I) are on the same page that if we don't get the approval letter by Thursday, we will start to submit offers Friday morning before the weekend rush. We will discuss this with our agent. I have this little light bulb going off saying there was never an approval from the 2nd and she was trying to buy time, and keep us waiting, to hopefully pull it off magically at the 11th hour. Still could be wrong, but we have totally gone from easy flow to an abrupt stop.
Update 8
02/25/2016 - Agent told me seller side said hard copy was mailed (again) for the 2nd will be here by tomorrow or Monday at the latest. Ill believe it when i see it....
Update 9
03/01/2016 - RECEIVED HARD COPY. My Agent verified he had copies of both approval letters and they were sent to my lender. Close by date for 1st approval is 03/15, so we have 14 more days to finish. My lender told me he is currently working on getting us the date. We will cut it close but we have inspections still set for tomorrow. Hopeful we finish it! I was on the verge of giving up. ... Now to close out the deal...
Update 10
03/02/2016 - Locked in rate/FHA loan disclosure information. Did the inspection and everything is good. Only thing we were really advised about (besides some smaller items) was our house uses some piping popular in the 2000-2007 range. Apparently the fittings have a nationwide class action on them. There were no leaks seen but I was advised. It was a five letter word on the piping name and apparently this area has it in most houses. We were advised to sign up for the class action pool of money in case of issues down the road. But there were no major issues. Minor things to do upon move in.
Agent had me sign the docs for various forms. Lots to do with disclosures (nothing noteworthy) and aware of CA laws.
Exciting things so far and the lender said they will have the close date for us by the end of the week. They anticipate by 3/15 but said they may be able to move it up once they get the official close date (don't know who provides it or how they get to it but whatever lol). Everything looks to be running along.
Update 11
03/07/2016 - Signed lots of e-doc for acknowledging inspection, agent (buyer/seller) stating current property condition. There were a few other ones I signed forget the name but pretty much acknowledged the house is not move in ready.
03/08/2016 - Docs were getting ready. Our agent apparently left the company so I had to sign a paper stating that fact. The company owner is taking us to the finish line.
03/09/2016 - Docs ready for signing tomorrow at 2pm. So sign on 03/10 and told should be recorded Friday and then keys will be in hand. I am off Friday from work anyway so it works out perfect so I can change locks and start painting. Almost there...
Update 12
03/11/2016 - So now we are waiting on some back and forth between the front office staff, processor and funder. They are doing their review, etc
03/14/2016 - So we were supposed to close today but, of course, they had some issue with my checking/savings statements and wanted another statement copy of both. They are the exact same ones I already gave them. I verified. I gave them another copy 3 minutes after they asked at 8:03am and they sat on it all morning... now they tell me they have my file ready to submit but they missed the cutoff time for whatever process they use... so lucky me, we get to to draw this out till the 11th hour. We have to close on 3/15 per the 1st approval letter.... added and UNNEEDED drama. They specifically stated it will be submitted first thing in the morning to fund and get recorded. Keys in afternoon....
(Been so busy, I haven't had time to give the final update on CLOSING and GETTING the house.
03/15/2016 - Delay in the morning. Wire was not received in time for morning deed recording. Promised by 12pm. 12pm rolls by and received confirmed wired funds at 12:10pm. Recording pushed to county office closure right before 3:00pm. At 3:13pm, my agent e-mails me the official closure and picked up keys at 4:50pm.
03/16/2016-04/10/2016 - Got new floors, working on paint, lots of work in progress and updating house.
04/11/2016 - About 80% done moving in. However, loan was all good and payments start in May. I hope you all enjoyed my journey. This will be my last update and we love our house.
Update 14:
Well I guess it wasn't my last update but I wanted to share because this thread is always a great read. Prices have spiked over the past 7 months and already have 30k equity (on the low end). Will be doing a refi here soon.
One big thing I found out was that there was definitely some Seller agent games being played during the process and my agent now works for this lady's "group". Very shady stuff overall... happy with the house but unhappy about what I came to find out recently in what was going on. My agent's boss (Owner) asked if I could give her feedback and wanted to share info.
Anyways, all you SS people out there I hope you get approval letters and close. It is one of the best feelings.
Well I guess it wasn't my last update but I wanted to share because this thread is always a great read. Prices have spiked over the past 7 months and already have 30k equity (on the low end). Will be doing a refi here soon.
One big thing I found out was that there was definitely some Seller agent games being played during the process and my agent now works for this lady's "group". Very shady stuff overall... happy with the house but unhappy about what I came to find out recently in what was going on. My agent's boss (Owner) asked if I could give her feedback and wanted to share info.
Anyways, all you SS people out there I hope you get approval letters and close. It is one of the best feelings.
Still waiting on ours. We are 9 months in and it has been stressful to say the least. A lot of title issues that needed to be cleared. We have all of the junior lien-holder on-board now and are just waiting for final approval from the main mortgage holder. Seems like the end is in sight. Can't wait till this is all finally over.
Here is my timeline on a short sale i'm patiently waiting on.
Home is listed at $740,000
On the market for over a year.
7/1/2016 - Contacted listing agent and went to see the home. We loved the home and decided to make an offer after the holiday.
7/5/2016 - Made an offer at $695,000. Sellers approved same day.
7/6/2016 - Listing agent asked for Proof of funds. Sent same day.
7/22/2016 - Listing agent asks for Net sheet(?) tells us we should hear back from bank in 5-7 days.
7/31/2016 - Listing agents asks for POF again.
8/18/2016 - New appraisal is done on the home.
8/31/2016 - Listing agent contacted bank....still no news.
9/2/2016 - Appraisal came back on the home at $765,000. Listing agent tells us bank wants at or close to appraisal price. Our offer is firm at $695,000. Tells us sorry, so we decide to move on.
9/12/2016 - Listing agent contacts us and tells us that the bank may consider our offer. Highest we say we will offer is $700,000.
9/13/2016 - Signed price change addendum to $700,000. Sellers sign the same day.
9/23/2016 - Underwriter needs to review our offer.
9/30/2016 - Listing agent asks us to send another pre approval letter because numbers aren't matching up after we changed our purchase price.
This is where we are at right now.
The listing agent doesn't really give us too much information. We have to contact her and ask what's going on most of the time. She is also very good friends with the sellers living in the home currently.
This home is in a great neighborhood with great schools, built in the 2000s, and in pretty nice condition, but the listing agent has told us that there hasn't been much interest in the home. We are currently the only offer the bank has on on the home right now.
We are hoping that it works out, but seeing the appraisal price and our offer price...we aren't too sure the banks will accept. At the same time though, seeing that they haven't rejected us yet and are asking for more documents makes me wonder if they will actually consider it? I'm dying to know and getting exhausted waiting!!
Wondering if anyone has experience offering under appraisal price and getting their short sale accepted?
UPDATE (still playing the waiting game...)
10/4/2016 - Still no news. Waiting on the last person to underwrite.
10/12/2016 - Got news that the bank is changing servicing companies (WTH IS THAT SUPPOSED TO MEAN???)
nothing since then. They are switching the servicing company in December, but WTH...that's still 2 months away and we have no news. The selling agent keeps getting her emails hacked too and it's really frustrating us. i'm so tired of waiting and not knowing, but the house might be worth it???
10/28/2016 - Going to view 2 homes today and if they work out...might let go of the short sale home
10/4/2016 - Still no news. Waiting on the last person to underwrite.
10/12/2016 - Got news that the bank is changing servicing companies (WTH IS THAT SUPPOSED TO MEAN???)
nothing since then. They are switching the servicing company in December, but WTH...that's still 2 months away and we have no news. The selling agent keeps getting her emails hacked too and it's really frustrating us. i'm so tired of waiting and not knowing, but the house might be worth it???
10/28/2016 - Going to view 2 homes today and if they work out...might let go of the short sale home
Once it has been announced the investor behind the note has designated a new servicer coming in December, I would predict that the current servicer will stonewall this short sale attempt the rest of the way.
They have no financial incentive to do anything else beyond collect their final servicing fees, & then simply pass the account like a hot potato to the next servicer, who invariably will insist everything start all over again.
It will likely mean the new servicer will want to re-examine the seller's financials, & insist a whole new proprietary short sale package be submitted for review, including up to date taxes, bank statements, & pay stubs from the seller. Remember, the seller has to qualify for mercy before the new servicer even begin to consider your offer.
It's quite likely they'll insist on all new forms, just to determine whether the seller meets their guidelines. I went through this drill numerous times as a short sale listing broker in CA.
Changing servicers in the middle of a current executed offer usually meant the whole ordeal was going to get extended at least 4 or 5 more months, because the new servicer quite likely won't even show the new account in their system for several more weeks, even after the so-called official transfer date. Then the listing broker gets to resubmit everything, all over again.
It really is a miserable situation, for you the would-be buyer, as well as the listing broker, who's really doing all the work.
But then again, the seller probably doesn't really care all that much, because they're quite likely living in the house for free. If they weren't (or aren't) in default, there wouldn't be a short sale in consideration.
I have had success on eventually closing drawn out short sales after reassigned servicers...but often it was with the 2nd, 3rd, or even 4th buyer, as much as 18 months down the line. When a buyer got fed up & dropped out, I'd reactivate the listing, execute with a replacement buyer, & start it all up all over again. It can be done, but it ain't easy!
I'd suggest renewing your efforts to find an alternate property to purchase...but keep your short sale offer on the table until such time that the investor behind the note decides to take you up on your offer, or you find a better deal. That's the way it goes with short sales.
October 12 - Offer accepted!! Not quite the 5 day turnaround, but 2 months is still not too bad! Our lender already has all the loan paperwork complete, now they just need to do their appraisal!
October 17 - Home inspection day! We were told the sellers have already found another place to leave so we are keeping our fingers crossed that they are all moved out already
Home inspection went well!
October 21 - Received the official written approval from Wells Fargo!
October 24 - Bank Appraisal completed
November 2 - Got the clear to close as early as 10 business days!!
November 15th at 10am is officially closing time!!
Overall not a long process compared to other short sales, but still required a lot of patience.
Home inspection went well!
October 21 - Received the official written approval from Wells Fargo!
October 24 - Bank Appraisal completed
November 2 - Got the clear to close as early as 10 business days!!
November 15th at 10am is officially closing time!!
Overall not a long process compared to other short sales, but still required a lot of patience.
112 days of waiting. Not too bad
Congrats! Sounds like there was only one lien on the home? My sister bought a similar short sale a few years ago where there was only 1 lien (mortgage). It was smooth and quick.
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He has set himself up as a 'one stop shop' for short sales, with an in house escrow company, and mortgage company. If I didn't like the house so much they had listed, I would never deal with these folks. We are lucky to get one email a week, and only because my REA bugs them.
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