Banks and short sales are pissing me off!

Well, what can I say…. Short Sales are a big part of my business and while I wish every sale were a regular non-distressed sale, those days are gone for a while. I am writing this because recently, I have had a few short sales go sour because of what appears to be a need to punish the homeowner for making a bad investment. It’s happened with a few bank and especially with one big bank with the initials of a large snake (Guess which bank has the initials of a large snake?) Anyway, what these banks are doing is the following…… They are asking the owners of distressed properties for large amounts in cash at closing or promissory notes (a promise to pay) in order to allow the short sale. There is one major problem with that….. The people doing short sales have bad credit already and most of them have no money and tons of debt. I am not judging and yes maybe they should not have bought more home than they could afford. The problem is that the banks are also hurting the investors that buy the notes from them (If you did not know, most banks service/bill most of the loans but don’t actually own them). I have had a bank recently decline a short sale only to foreclose and then sell the property for a lot less as a foreclosure. They did not actually own that note but only serviced it. They could have gotten more money for their investor but instead they chose to punish the seller and not allow him to short sell. I actually went to a seminar hosted by Bank of America and the negotiators actually admitted that it is policy to not allow a short sale in order to punish a seller of non-primary residence. Another technique that they are using is telling us agents, negotiators and attorneys that the M.I (Mortgage Insurance) company is requesting a promissory note or they will block the short sale. So the question is….Did these banks go out and buy mortgage insurance behind the property owners back and not charge them for it? Or is an excuse to block the short sale, since it’s my experience that banks don’t pay for anything without passing on to the consumer? It may be that these M.I. companies are asking for these promissory notes but they are also not telling us negotiators who that M.I. company is since they don’t want us to call that company and negotiate a smaller pay off. We negotiate payoffs with associations, 2nd loans, contractor’s liens, home owner associations….. so why not M.I. companies? To these banks I say…. who are you to punish the investor for making a bad investment? Did we not need to bail you out for your bad investments? Something fishy is going on with these banks and there “M.I.” companies. I have a short sale guide for those of you that dont know what a short sale is and here is the link(copy and paste into your browser) http://www.prestigefloridahomes.com/Buyer-Resources/Buyer-Suggested-Reading/Short-Sale-Guide Please feel free to share any of your experiences with me here.

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