In life, there are always little twists that keep it interesting, wouldn't you say? For example, last week I was watching a HGTV show about a couple who were buying their first home somewhere in the Midwest. They had obtained an FHA loan. Because they didn't have the money for a down payment, their parents gave them the cash.
Of course, FHA requires a gift letter from the parents. This gift letter specifically states that the funds are not a loan but a gift. At the end of the show, the couple stood in front of the camera, talking about their home buying experience. The wife looked straight into the camera and admitted on national television that they had committed mortgage fraud. "Oh, we are paying them back," she laughed.
I imagine their real estate agent recoiled in shock.
Just like my Sacramento short sale seller was speechless yesterday. This is a hard working guy who lost his job, and the value of his condo fell to almost 1/3 of what he paid for it several years ago. He hired me as his Sacramento short sale agent to find a buyer. It took about 10 days to get into contract, which is an usually long time for my Sacramento short sale listings.
Yesterday, a negotiator from the Wachovia short sale department called to say the short sale was approved. Not only was it approved, she explained, but this transaction qualified for Wachovia's incentive program, meaning the agents would receive a higher commission than the amount Wachovia generally pays. In addition, the seller would receive cash to move.
I called the seller and left a message, saying I had unexpected news for him. When he called me back, I could sense the trepidation in his voice. He admitted that he had a pit in his stomach. But when I told him he would receive $2,500 for moving expenses, he was at a loss for words. "What do I have to do?" he asked, assuming there was a catch. Nothing. Just sign Wachovia's short sale approval letter and close escrow.
This is one very happy short sale seller right now.
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Certified HAFA Specialist
My Sacramento Real Estate Listings
Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout the four-county Sacramento area. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. Broker-Associate at Lyon Real Estate. DRE License # 00697006.
The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com.
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Elizabeth: That bit about the mortgage fraud is funny. As for the Wachovia short sale, that is amazing. I'm glad your seller is getting some help and you are getting a raise.
Elizabeth,
Your seller is lucky to have you as their agent...and with all the rain in his life these days, this must of been a ray of sunshine!
Elizabeth - well that certainly is good, and surprising, news.A bank actually doing something that benefits the consumer in some way.
The line from HGTV is oretty funny. I'm surprised the show would even air that. Wonder if someone will follow-up?
Jeff
Thanks for sending out a bit of positive short sale news, there's been precious little of it. Good for you for spreading the sunshine!
Yeah, Wachovia really has its act together, as compared to the other short sale lenders. It was a nice surprise and twist to hear the seller would actually receive cash instead of battling negotiations for a prom note or cash contribution.
I let another Wachovia short sale seller know that it's possible that she may qualify for this incentive program as well. Her short sale, I hear, will be approved in about another week.
As for the FHA couple on HGTV, I would imagine that somebody might tip off FHA. Those buyers went into a length discussion about how they were making payments to their parents and never intended for their parents to gift them the money in the first place. HGTV generally films this portion of the show months after the transaction has closed, so their agent most likely was not present for this part of the show.
Elizabeth - I can imagine that call made him a very happy seller, and probably softened the blow of other financial things he had been going through! It's good to hear some of the nicer things that can happen in this type of transaction.
I had a relative a few years ago and her at the time future/ now former in laws wrote a gift letter to her, not to their son... fast forward... when the divorce was happening they sued for repayment of the "gift". HAHA Didn't get very far when a judge saw the "gift" letter. I can't believe they didn't edit that out. Wonder if some watchdog saw the show and will investigate??
Good for your seller, that's way cool that he can at least walk away with some help to move since he lost so much of his investment.
Elizabeth - I have worked with HGTV...I can't believe that they would not have edited that out.
Congratulations on the Wachovia deal. It is very heartening to hear!!!
Great to hear your seller had such a good experience--you're Wonder Woman in his eyes now, I bet!
It is great to hear good news! Sounds like Wachovia is one of the ideal banks to work with on short sales. Second great thing you have said about them. Congrats on the bonus - I know it is well earned!
Interesting about the show - I'm sure the wife thought she was being cute...little did she know what she was admitting too.
Elizabeth, you will have to look at my last blog post, this brought tears to my eyes!!!!!!!!!!!!!! That is wonderful!!!!!!!!!!
If we think about how many of the foreclosures we are seeing now are a result of mortgage fraud the HGTV comment just falls in line with today's mindset. Meanwhile WOW on the Wachovia deal.
Elizabeth - Any changes due now with Wells Fargo aquisition of Wachovia that you are aware of? This is great info on your short sale.
That short sale sounded like a breeze! You did a great job again.
This is so unusual I've never heard of them doing all of these on one transaction.
Wow... I'm so jealous. If the lenders were not so backward thinking they would all do this. And, considering all the money we save them by preventing foreclosures seems they should regularly pay us bonuses and higher commissions to thank us for all our extra effort. Oh, if only...
Hopefully I haven't commented twice on this, but I can't say enough about Wachovia's streamlined, expedited short sale program.
It was tested in California first and has now been rolled out in Arizona. We're seeing great success with it in the Phoenix area. It's available to distressed home owners through real estate agents that have access to the program. The thing I think I like best about it is that we can arrange for a decision maker with the bank to come out and meet with the distressed home owner. The bank rep vets out whether or not a loan mod is an option and goes from there.
Best part? 45 DAY CLOSE! It's also availabe to distressed sellers with Golden West and World Savings loans. This approach is so much better than having to call and nag the bank for months. The home owner has a better shot at staying in the home AND keeping current on their payments because the process is so quick.