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  • August 9, 2007 at 4:31 PM #72496
    bsrsharma
    Participant

    “What if they went on and then the next day everyone ..”

    I would at least like to think people will show some sympathy and try to help whatever way they can. Misfortunes can happen to anyone, I don’t think anyone with a fibre of humanity will ridicule them, at least in their face. But I agree it is not your domain to advice them on that.

    August 9, 2007 at 11:07 PM #72620
    temeculaguy
    Participant

    SD, why do you think the lenders are so cranky about letting them off with a short sale. I would think the lenders would have come around by now, do they not have a stock ticker. The loss in their stock value because of their bloated foreclosure inventories has to hurt them more than letting people off with a short sale. Investors have lost faith in them, the public has lost faith in the market, it seems the last bastion of perma bulls is the lenders. I also see short sale houses are more marketable than vacant brown lawners with the appliances missing, I just don’t get the lender mindset that the house will be worth much more in six months after it’s trashed and the lawn is dead.

    August 9, 2007 at 11:07 PM #72738
    temeculaguy
    Participant

    SD, why do you think the lenders are so cranky about letting them off with a short sale. I would think the lenders would have come around by now, do they not have a stock ticker. The loss in their stock value because of their bloated foreclosure inventories has to hurt them more than letting people off with a short sale. Investors have lost faith in them, the public has lost faith in the market, it seems the last bastion of perma bulls is the lenders. I also see short sale houses are more marketable than vacant brown lawners with the appliances missing, I just don’t get the lender mindset that the house will be worth much more in six months after it’s trashed and the lawn is dead.

    August 9, 2007 at 11:07 PM #72745
    temeculaguy
    Participant

    SD, why do you think the lenders are so cranky about letting them off with a short sale. I would think the lenders would have come around by now, do they not have a stock ticker. The loss in their stock value because of their bloated foreclosure inventories has to hurt them more than letting people off with a short sale. Investors have lost faith in them, the public has lost faith in the market, it seems the last bastion of perma bulls is the lenders. I also see short sale houses are more marketable than vacant brown lawners with the appliances missing, I just don’t get the lender mindset that the house will be worth much more in six months after it’s trashed and the lawn is dead.

    August 10, 2007 at 2:48 PM #72902
    SD Realtor
    Participant

    No sure tg… A few weeks back there was a poster who worked in a loss mitigation group. I thought he was the most valuable contributer we have had here for a long time. I wish he would come back.

    Right now even if my clients do get an offer, it will take the lender between 10-21 days to simply respond to the offer. Lenders all differ in their responses but I have heard similar short sale stories. When you peruse the MLS the best thing about buying an REO is that it is NOT a short sale so the processing is much quicker.

    I am with you though… I would agree that if I were a lender I would jump to get through a short sale as opposed to going through the default process, trustee sale, then relisting it as an REO only to get the same sales price or less. Especially with inventory piling up.

    You know those lenders though…they are way way smarter then any of us peons so they must be correct…

    SD Realtor

    August 10, 2007 at 2:48 PM #73020
    SD Realtor
    Participant

    No sure tg… A few weeks back there was a poster who worked in a loss mitigation group. I thought he was the most valuable contributer we have had here for a long time. I wish he would come back.

    Right now even if my clients do get an offer, it will take the lender between 10-21 days to simply respond to the offer. Lenders all differ in their responses but I have heard similar short sale stories. When you peruse the MLS the best thing about buying an REO is that it is NOT a short sale so the processing is much quicker.

    I am with you though… I would agree that if I were a lender I would jump to get through a short sale as opposed to going through the default process, trustee sale, then relisting it as an REO only to get the same sales price or less. Especially with inventory piling up.

    You know those lenders though…they are way way smarter then any of us peons so they must be correct…

    SD Realtor

    August 10, 2007 at 2:48 PM #73026
    SD Realtor
    Participant

    No sure tg… A few weeks back there was a poster who worked in a loss mitigation group. I thought he was the most valuable contributer we have had here for a long time. I wish he would come back.

    Right now even if my clients do get an offer, it will take the lender between 10-21 days to simply respond to the offer. Lenders all differ in their responses but I have heard similar short sale stories. When you peruse the MLS the best thing about buying an REO is that it is NOT a short sale so the processing is much quicker.

    I am with you though… I would agree that if I were a lender I would jump to get through a short sale as opposed to going through the default process, trustee sale, then relisting it as an REO only to get the same sales price or less. Especially with inventory piling up.

    You know those lenders though…they are way way smarter then any of us peons so they must be correct…

    SD Realtor

    August 10, 2007 at 3:09 PM #72935
    PerryChase
    Participant

    Lender cannot allow short sales simply because it makes financial sense for them, at the moment.

    They need the hardship packages to be completed and submitted for review by several levels of management to make sure it’s legitimate. Otherwise, the fraud will get to a level not seen before. What’s to stop everyone from asking for a short sale? Realty agents, appraisers and bank employees will “engineer” short sales of all kinds to defraud on the way down just like they did on the way up.

    Audits and checks and balances are key to a functioning system and during the boom, controls were thrown out the window. The lenders need time to get those control systems back into place.

    Also, lenders cannot reward bad investment decisions. If a homeowner has other assets, lenders will not approve a short sale to avoid foreclosure (even if they will ultimately get less in foreclosure). That would be rewarding bad business decisions and encourage it the future.

    If word gets out that short sales are a given as soon as a house is on the MLS, and a purchase offer is submitted, then everyone who is underwater will ask for a short sale.

    Realtors who thinks that they can market a short sale then present the lender with a fait-accompli doesn’t undertand the business.

    August 10, 2007 at 3:09 PM #73055
    PerryChase
    Participant

    Lender cannot allow short sales simply because it makes financial sense for them, at the moment.

    They need the hardship packages to be completed and submitted for review by several levels of management to make sure it’s legitimate. Otherwise, the fraud will get to a level not seen before. What’s to stop everyone from asking for a short sale? Realty agents, appraisers and bank employees will “engineer” short sales of all kinds to defraud on the way down just like they did on the way up.

    Audits and checks and balances are key to a functioning system and during the boom, controls were thrown out the window. The lenders need time to get those control systems back into place.

    Also, lenders cannot reward bad investment decisions. If a homeowner has other assets, lenders will not approve a short sale to avoid foreclosure (even if they will ultimately get less in foreclosure). That would be rewarding bad business decisions and encourage it the future.

    If word gets out that short sales are a given as soon as a house is on the MLS, and a purchase offer is submitted, then everyone who is underwater will ask for a short sale.

    Realtors who thinks that they can market a short sale then present the lender with a fait-accompli doesn’t undertand the business.

    August 10, 2007 at 3:09 PM #73059
    PerryChase
    Participant

    Lender cannot allow short sales simply because it makes financial sense for them, at the moment.

    They need the hardship packages to be completed and submitted for review by several levels of management to make sure it’s legitimate. Otherwise, the fraud will get to a level not seen before. What’s to stop everyone from asking for a short sale? Realty agents, appraisers and bank employees will “engineer” short sales of all kinds to defraud on the way down just like they did on the way up.

    Audits and checks and balances are key to a functioning system and during the boom, controls were thrown out the window. The lenders need time to get those control systems back into place.

    Also, lenders cannot reward bad investment decisions. If a homeowner has other assets, lenders will not approve a short sale to avoid foreclosure (even if they will ultimately get less in foreclosure). That would be rewarding bad business decisions and encourage it the future.

    If word gets out that short sales are a given as soon as a house is on the MLS, and a purchase offer is submitted, then everyone who is underwater will ask for a short sale.

    Realtors who thinks that they can market a short sale then present the lender with a fait-accompli doesn’t undertand the business.

    August 10, 2007 at 4:03 PM #72979
    temeculaguy
    Participant

    Thanks Perry, that makes sense. I get everything about the checks and balances but as far as the industry not wanting the word to get out to prevent everyone from wanting it or rewarding bad behavior, I don’t put enough faith in them as a group. They played a big role in what is now rocking the global economy all based in part on their greed and competition against each other. I don’t see them being in lock step as they go down, my guess is some will break away and try and save their own skin very soon. But I guess they are just acting like anyone would, smiling and extending credit while they make money and very cautious/suspicious while they are losing it.

    August 10, 2007 at 4:03 PM #73104
    temeculaguy
    Participant

    Thanks Perry, that makes sense. I get everything about the checks and balances but as far as the industry not wanting the word to get out to prevent everyone from wanting it or rewarding bad behavior, I don’t put enough faith in them as a group. They played a big role in what is now rocking the global economy all based in part on their greed and competition against each other. I don’t see them being in lock step as they go down, my guess is some will break away and try and save their own skin very soon. But I guess they are just acting like anyone would, smiling and extending credit while they make money and very cautious/suspicious while they are losing it.

    August 10, 2007 at 4:03 PM #73100
    temeculaguy
    Participant

    Thanks Perry, that makes sense. I get everything about the checks and balances but as far as the industry not wanting the word to get out to prevent everyone from wanting it or rewarding bad behavior, I don’t put enough faith in them as a group. They played a big role in what is now rocking the global economy all based in part on their greed and competition against each other. I don’t see them being in lock step as they go down, my guess is some will break away and try and save their own skin very soon. But I guess they are just acting like anyone would, smiling and extending credit while they make money and very cautious/suspicious while they are losing it.

    August 10, 2007 at 6:08 PM #73066
    SD Realtor
    Participant

    Perry –

    We have delivered the hardship package already. Everything is in place at the lender and these people do not have any assets for the lender to chase down. I had a long talk with one of the people in the loss mitigation group for this particular lender about the current pricing. Not only do they insist on the processing time to respond to the offer, they give no insight during the listing period about whether they will accept something in the price range or not.

    The bottom line is, that even with everything in place and ready to go, the lenders are being quite uncooperative working with short sales. Now perhaps that is being driven by the sheer volume of short sales and the lack of staff to handle the crush. In my mind it would make common sense that if there is an REO down the street with the EXACT same floorplan and that has been priced the same as this short and is still sitting there unsold, that a lender would jump at any offer if we indeed received one.

    I absolutely agree with your points however at least with the lender I am dealing with right now, they are not showing any cooperation or motivation at all.

    SD Realtor

    August 10, 2007 at 6:08 PM #73186
    SD Realtor
    Participant

    Perry –

    We have delivered the hardship package already. Everything is in place at the lender and these people do not have any assets for the lender to chase down. I had a long talk with one of the people in the loss mitigation group for this particular lender about the current pricing. Not only do they insist on the processing time to respond to the offer, they give no insight during the listing period about whether they will accept something in the price range or not.

    The bottom line is, that even with everything in place and ready to go, the lenders are being quite uncooperative working with short sales. Now perhaps that is being driven by the sheer volume of short sales and the lack of staff to handle the crush. In my mind it would make common sense that if there is an REO down the street with the EXACT same floorplan and that has been priced the same as this short and is still sitting there unsold, that a lender would jump at any offer if we indeed received one.

    I absolutely agree with your points however at least with the lender I am dealing with right now, they are not showing any cooperation or motivation at all.

    SD Realtor

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