Now that homebuyers no longer feel pressured to buy a home before the home buyer tax credit expires (because it was extended to April 30, 2010), it seems that the market is a teeny bit quieter in Sacramento. Usually Mondays are the worst day of the week, phone-wise. My cellphone tends to ring constantly on Mondays, generally because buyers are out over the weekend looking at homes. But yesterday, it was eerily silent.
In fact, I mentioned to my husband over lunch that my phone hadn't rung once. Was the market slowing down? He asked me if it was turned on. Duh. Of course, it's turned on because it asked to connect me to my Jawbone. It's illuminated. It's on. See? I showed him my phone. Oh. No bars. Somehow, and don't ask me how, I had managed to turn off my wireless connection. Holy crap. Four hours of phone messages.
I often get asked by media whether the short sale market in Sacramento is improving or getting worse; i.e., meaning is it taking longer to get short sale approval or are the banks and PSAs starting to get their acts together. It depends on which banks we're talking about. If it's a Wachovia short sale, the length of time to wait for short sale approval is still the same -- about a week.
If it's a Bank of America short sale or, worse, the loan originated at Countrywide, it's at least 90 days but it could be 6 to 9 months before approval. Aurora used to be better than it is now. Last spring approval came from Aurora within 6 weeks. I've got a handful of Aurora short sales now that are dragging. Last week, an Aurora negotiator told me that the 60-day approval we expected to receive next week is being pushed to 120 days out.
Lovely. Because CitiMortgage, which holds a second on this property, just issued short sale approval. It is set to expire in 2 weeks. On this particular short sale, Aurora holds the first. I emailed the negotiator to ask him why CitiMortgage would give us only a 2-week window on the approval letter when we don't have approval from the first lender, Aurora. Because this is an all-cash transaction, the buyer could perform, but we aren't going anywhere without Aurora's blessings.
His response? Because we should have had approval from Aurora by now. What was he smoking? His response inferred that we somehow dropped the ball, which is nuts. As a busy yet organized Sacramento short sale agent, I manage the short sale process like a gorilla.
I sense that CitiMortgage is now disguising its approval letters. I mean, the thing looks like an approval for a certain dollar amount, but CitiMortgage is really asking for more money. In this letter, CitiMortgage demanded a 2-week escrow but will agree to extend if it receives an 11% premium on the short-pay. It's not a large amount, about $5,000. So the true payoff is about $5,550. A $550 difference. Which the buyer shouldn't have to pay.
We quickly amended the HUD-1 to reflect the true demand from CitiMortgage and sent it off to Aurora. And this is how an escrow that was slated for approval next week will be pushed to January. But hey, at least my cellphone is working again.
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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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The views expressed herein are Weintraub's personal views and do not reflect the views of Lyon Real Estate.
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You seem to be experiencing the same thing we are here in Arizona with B of A, Citimortgage, etc....
It is really an amazing time to be chasing so many banks down to get information to help out our clients! I can relate so well to what you wrote in your blog. I believe that most agents doing short sales are experiencing the same feelings all over the country. Thanks for sharing.
Elizabeth: Your stories are priceless. Turned off your wireless connection? Unreal. I guess the Sacramento short sale market isn't dying. Good to know you are getting deals done and the phone is still ringing.
I rarely see Aurora out here. Saw one once, sellers were totally unreasonable on their price, and they fired me for suggesting selling at market value. They sold, with another agent, for EXACTLY what I told them they should be priced.
Elizabeth - Always a pleasure to read your blog. We're seeing Wachovia approve short sales in as little as two weeks, but have a US Bank deal that's been dragging now for 6 months. Some days, I think it's getting better, and then a a deal goes sideways.
Funny that you had cell phone issues yesterday and I did too. It's amazing that you can keep your witts about you with all these different banks you are dealing with. Maybe fate thought you needed that 4 hour break from your phone.
Elizabeth - I have not seen that approval letter from Citi, not good. What will they think of next?
Elizabeth - I so appreciate your blogs. We experience similar situations here in Phoenix, but it seems many of the banks are getting a better handle on short sales and streamlining the process (i.e. Wachovia, World Savings, etc.) and expediting the approval process. Now, if only the rest would follow suit!
What fun new twists on the short sales good to have you as the experienced negotiator.
Hi Elizabeth, I must be hungry because my eyes just lit up at the sight of that cake! Thank goodness that the phone was only turned off ...instead of no calls, which in the long run would be a lot worse! After all of the shortsales I'm surprised some lenders (BOFA) haven't found a way to move faster.
Well, we'll see if CitiMortgage will approve the HUD after we finally get the approval from Aurora. That's when the rubber hits the road.