Donna Chorey

FOR THOSE OF YOU WHO HAVE NEVER BEEN INVOLVED IN A SHORT SALE TRANSACTION, MY BEST ADVISE IS TO NOT GET INVOLVED OR HAVE A LOT OF PATIENCE. USUALLY YOUR BUYERS WILL NOT HAVE THE PATIENCE FOR THE LENDER TO MAKE A DECISION AND WILL PROBABLY BLAME YOU FOR THE WHOLE AFFAIR IF YOU ENCOURAGE THEM TO MAKE AN OFFER.

JUST BECAUSE THE SELLER ACCEPTS THE SHORT SALE, REMEMBER THAT THE LENDER/S MAKE THE FINAL DECISION AND THEY ARE OVERWHELMED WITH THIS PROCESS.

I HAD A LISTING THAT TURNED INTO A SHORT SALE (DIVORCE ISSUES) AND THE SELLERS DIDN'T CARE WHAT IT WAS SOLD FOR, THEY WOULD HAVE SIGNED ANYTHING. I ALSO HAD A CASH BUYER WHO MADE A GOOD OFFER. I WAS DEALING WITH COUNTRYWIDE WHO HAD THE SECOND MORTGAGE AND WAS ALSO SERVICING THE FIRST MORTGAGE FOR THE INVESTOR, BANK OF NEW YORK. BOTH MORTGAGES HAD MORTGAGE INSURANCE ON THEM. THAT SHOULD HAVE MY FIRST CLUE THAT THINGS WOULD NOT GO WELL.

LOW AND BEHOLD, COUNTRYWIDE HAD AN APPRAISAL DONE THE FIRST WEEK I PRESENTED THE SHORT SALE OFFER TO THEM. THAT SEEMED TO BE GOOD PROGRESS. THEY ASKED THE BUYER TO COME UP TO THE APPRAISED VALUE, WHICH THE BUYER DID. ( THE OFFER WAS ONLY OFF $3,000 FROM THE APPRAISED VALUE). THEY ASKED ME TO CUT MY COMMISSION, WHICH I DID.

THEN THINGS JUST CAME TO A STOP. THE NEGOTIATOR I WAS ASSIGNED HAD OVER 100 FILES ON HER DESK AND SAID THAT THE OTHER EMPLOYEES IN THAT DEPARTMENT HAD THE SAME WORKLOAD. SHE WAS JUST SHUFFLING FILES FROM ONE SPOT ON THE DESK TO ANOTHER. HADN'T A CLUE WHAT SHE WAS ACTUALLY DOING OR SUPPOSED TO DO NEXT.

I WAS TOLD THAT THIS PROCESS WOULD TAKE 4-6 WEEKS AND THE BUYERS WERE OKAY WITH THAT. THEY DIDN'T HAVE A HOUSE TO SELL OR ANY CONTINGENCIES AT ALL. AFTER 8 WEEKS, THE FILE WAS STILL WITH THE NEGOTIATOR. THE BUYERS DECIDED TO HAVE THE HOME INSPECTION DONE AND WHEN THERE TURNED OUT TO BE $4,000 IN REPAIRS (ESPECIALLY ROOF ISSUES), THEY KNEW THAT COUNTRYWIDE WOULD NOT NEGOTIATE WITH THEM ON IT, SO THEY JUST SAID "FIND ME ANOTHER HOUSE". THEY CLOSED ON THE NEXT HOUSE IN 3 WEEKS.

THIS TRANSACTION STARTED BACK IN DECEMBER, 2007 AND WE TERMINATED IT IN MARCH, 2008. THE PROPERTY HAD A LIS PENDENS (FORECLOSURE NOTICE) FILED ON IT IN APRIL, 2008 AND THE HOUSE IS STILL NOT FORECLOSED ON. THE BUYERS HAVE NOT MADE A PAYMENT SINCE SEPTEMBER, 2007 - OVER 12 MONTHS.

WE HAVE HAD OTHER SHORT SALE TRANSACTIONS GOING ON IN OUR EXIT REALTY HORIZONS OFFICE. ONE HAD TWO BUYERS INVOLVED OVER A 9 MONTH PERIOD AND NEVER DID CLOSE ON EITHER. ANOTHER ONE WAS AN AGENT WHO HAD THE BUYER AND WAS TOLD BY THE LISTING AGENT 2 DAYS BEFORE CLOSING THAT IT WAS NOW A SHORT SALE AND BUYER NEEDED TO COME UP WITH A HIGHER PURCHASE PRICE AND THE AGENT HAD TO CUT HER COMMISSION. THIS ONE NEVER CLOSED EITHER AS THE BUYERS WERE DISCOURAGED ABOUT THE HIGHER PRICE THEY WERE GOING TO HAVE TO PAY. THIS WAS NOT DISCLOSED AS A SHORT SALE BY THE LISTING AGENT OR THE SELLER. NO THIRD PARTY APPROVAL WAS INVOLVED WHEN THE PURCHASE AGREEMENT WAS WRITTEN AND THE BUYERS PAID FOR ALL THE INSPECTIONS. IT WAS A REAL DISASTER .

THERE HAVE BEEN A COUPLE OF SHORT SALES THAT WERE ACTUALLY CLOSED HERE IN LAS CRUCES, NM, BUT THE PROCESS IS SLOW.

IF YOU CHECK ON YOUR COUNTY OR CITY WEBSITES FOR THE MORTGAGES, I WILL FIND THAT THE SHORT SALES HAVE HUGE MORTGAGES ON THEM. USUALLY 100% FINANCING, INVESTORS, ETC.

SO, MY ADVISE TO YOUR REALTORS IS TO ALWAYS KNOW WHERE YOUR SELLERS STAND IN WHAT THEY OWE ON THEIR MORTGAGES AND WHETHER THEY HAVE BEEN MAKING THEIR PAYMENTS ON TIME. I HAVE A FORM I USE TO SEND TO THE MORTGAGE HOLDERS. IF YOU WOULD LIKE THAT, EMAIL ME AND LET ME KNOW AT DMCHOREY@COMCAST.NET OR GIVE ME A CALL: 575-640-1332.

I AM A RETIRED BANKER WHO WORKED IN MORTGAGE LENDING AND ALSO RAN THE MORTGAGE DEPARTMENT OF A SMALL BANK IN MONTANA. I HAVE HAD TO WORK WITH COLLECTION AND FORECLOSURE ISSUES SO KNOW A LITTLE ABOUT THE PROCESS.

GOOD LUCK!