RealtyTrac reports short sales are up 38% in California for the second quarter of 2011. As a Sacramento short sale agent, I guess I am doing my fair share at moving those preforeclosure sales. For example, yesterday I closed 4 short sales. It would have been 5 except AMS -- who is a Bank of America short sale third-party vendor -- is not quite on the ball, no surprise there.
When asked why is AMS sitting on a HUD -- which was uploaded to Equator 3 days ago and would have been immediately approved by an employee at Bank of America -- Daniel said AMS has 5 days to approve a HUD and just hasn't gotten around to it. He also added that AMS will look at that HUD when AMS is good and ready to do it. So, while we could have cut Bank of America's losses on that Cooperative Short Sale yesterday, it did not close because AMS was obviously too busy to open the file.
I also see that Warren Buffet tossed $5 billion at Bank of America. Sort of dwarfs my own puny investment last month into Bank of America, but I do believe the company is a sound investment. Of course, Buffet got preferred; I got common, but still. Thumbs up, Bank of America. Now, if you can just do something about the lousy performance at AMS, like hire a company that doesn't give us short sale agents so many headaches and lose you money.
But I am tired of belly-aching about AMS. I'd rather look at the more positive side of short sales. For example, yesterday, I closed a Bank of America Freddie Mac short sale in Colonial Heights, a Nationstar short sale in Rocklin, a double PNC short sale in Midtown Sacramento, and a Seterus short sale in south Sacramento.
The Seterus short sale is noteworthy because it's been going on for more than 2 years. Two. Solid. Years. This started out as a former Countrywide, now Bank of America short sale. We even had approval a couple of times. But then squatters broke in, the pool turned green and slimy -- and the roof began to leak, dumping water on the kitchen floor and causing the ceiling to collapse. I believe I sold this home 8 times. Meanwhile, Bank of America sold the loan. The loan was sold almost as many times as I sold the home.
The problem is when you have a fixer property like this, it's hard to get the bank to understand the value of that home. That's because so many BPO agents don't know how to account for condition. So, they tell the bank it is worth more than it is. Then you have contractors who want to steal the home. Nobody wants to pay fair market value for a fixer. It's a real Catch-22. The bank and the potential buyers are too far apart.
On top of this, the price for this home continually changed. One day the bank wanted X, and the next day the bank demanded Y. The spread between these numbers varied by 30%. But if you're looking for logic in a Sacramento short sale, you're looking in the wrong place. Seterus (formerly LBPS) told me it wanted an enormous number. It was so high that it caused me to send a letter to Seterus suggesting that perhaps it simply put the seller out of her misery and offer a deed-in-lieu. The price Seterus wanted was too much. It's what completely remodeled homes sold for in this neighborhood, and this home was a fixer.
Seterus did not respond nor acknowledge my request. So, there was only thing left to do. Sell that home at that enormous price. That's what I am paid to do, believe it or not. And that's what I did.
You would think that would make the neighbors happy, but no. Some of them called me, demanding to know how I had the audacity to slap a price tag on that home that was so high. Agents were upset too because it reflected poorly on their listings. You know what? You can't make everybody happy. Spittooey, get out of my face.
I was worried about the buyer. He worked for the government in a capacity that, in my younger years, would have freaked me out. I also did not want him to spend all of this money fixing up the property before he actually owned it. However, there was no other way to get loan approval for him. We explained the drawbacks to him so he understood what he was getting into, even though I don't think he wanted to hear it, and he moved forward.
Sure enough, against all odds, it appraised. The buyer's appraisal matched the sales price. Shocked me.
See, the lesson in all of this is we can be dead right on value and dead wrong on what it will take to close. Miracles happen. Short sale agents should never give up on a seller or her short sale.
Today, that buyer is tearing off the roof and gutting the place. It's a happy ending. And I'm certain the neighbors will be wondering: How in the world did Elizabeth Weintraub ever pull this off? I didn't do it alone. It's a team effort.
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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.
Lyon Real Estate is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.
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The views expressed herein are Weintraub's personal views and do not reflect the views of Lyon Real Estate.
Disclaimer: If this post contains a listing, information is deemed reliable as of the date it was written. After that date, the listing may be sold, listed by another brokerage, canceled, pending or taken temporarily off the market, and the price could change without notice. It could blow up, explode or vanish. To find out the present status of any listing, please go to elizabethweintraub.com.
Still pondering whether the 2 year wait is a hopeful sign or a omg what the hell are we doing here sign
Elizabeth-Kudos to you. I can't imagine having the stamina to stick with a short sale for two years but if it is the only way to help our clients then we press on.
Hi Barbara: Well, this Seterus short sale is the longest short sale of my life. I have had no other 2-year short sales. And I hope I never do again. Knock on wood. The funny thing is I sold another short sale that this seller owned two years ago. Her two-year wait to buy a home was up. And now it starts again.
Hi Cindy: You wouldn't believe how many people bailed on this short sale. I initially hired another agent to work with Bank of America on this, but she split and dumped the file back in my lap. So I decided to do it myself. Then, the transaction coordinator dumped the file, and I took it in-house with my own TC. Nobody wanted to work on this.
Hi Elizabeth, I am exhausted just reading about the sequence of events. Can't imagine how it felt to live them. HUGE KUDOS TO YOU for not giving up. The seller was unbelievably lucky to have you on their side!
That is an amazing team effort and great perserverance on your part Elizabeth. You have to step back some days and wonder if there is a better way to make a living.
Was just talking to an agent in the office and he won't take a short sale below $400,000 because of all this mess. Can't somebody clean house with AMS? Dealing with them too! Ugh ....
Looks like we will have different Seterus Short Sale stories to report. I've got one going to closing on the 31st that was a breeze.
Hi Wendy: Well, the seller had moved out of state a long time ago. She had nobody on her side here, so I could not abandon her, no matter what.
Hi Gary: I do step back some days and ask myself if there is a better way to make a living and you know what my answer is? It's no.
Hi Barb: I just wish AMS were more like Bank of America is now and less like Bank of America was 6 years ago.
Hi Chris Ann: My other Seterus short sales are no problem. This is the only one that has been a thorn in my side.
I was sitting down and eating my popcorn reading this. You really do have to know your short sale business inside and out to make it work. You certainly do.
Elizabeth - The scenario you paint in this story, with the government worker putting out a number of dollars to fix the place up before he owned it, curls my toes, as I know it must have your's. I am really glad it worked out for you and the buyer, and after 2 years you can put this one behind you! I like your response to Gary. I am convinced some souls have something in their DNA that sets them apart from the rest of us and allows them to do battle daily against difficult odds. . .You are one of those souls!
Elizabeth, I got stuck on the fact that the Bank sold the loan...in the midst of a short sale? and the loan was sold as many times as you sold the house?! Sounds like a game of "hot potato" to me. Congrats on sticking with it for 2 years Elizabeth - that's a very long time!
Elizabeth
I have one that is just over a year.....Bank of America
And I have one where AMS dropped the ball, over and over again. Even after recruiting the assistance of the BOA twitter group, AMS still messed up.
That's the life of a short sale listing agent! >SIGH<
Hi Jane: Let's just say there is never a dull moment in a Sacramento short sale.
Hi Myrl: It did curl my toes, you're right. Especially, since this guy holds a supervisory position for a federal agency that back in the 1960s would have made you runaway from them.
Hi Mary: Bad debt has a price and a marketplace, sad to say. So, it is no wonder that these underwater loans are sold time and time again. I have no idea how that works or why anybody would buy it but there is definitely a market for it.
Hi Pacita: I'm sorry to hear that AMS is a thorn in your side, too.