Erin Attardi, Realtor - Sacramento, CA 916-342-1372

If you follow me on Facebook or Twitter, you will already know that one of my buyer clients closed escrow last Thursday on a short sale.

Just one of many transactions in the life of Erin Attardi, right? I wish. This was a unique and crazy transaction...even by short sale standards!

My clients randomly found this house back in March when happened to drive by it the first weekend it was on the market. It was being held open, so they went in, checked it out, and absolutely fell in love with it. I received an excited phone call that afternoon, and a couple days later we visited the house together. It was listed by a pretty well-known agent, so we did not hesitate to present a really strong offer that was $11,000 over the asking price...we were one of 4 offers, and fortunately we presented the best offer - so my buyer clients' offer was presented to the short sale lenders (Wells Fargo and GMAC) for consideration.

Hurry up and wait.

I spoke to my buyer clients weekly for about 8 weeks...they were not first time buyers, but they were also not familiar with the short sale purchase process. They actually inspired a blog post I wrote about what to expect as a buyer who makes an offer on a short sale listing. After about 8 weeks, the listing agent's assistant, who was negotiating the short sale, started gaining traction with the short sale lenders, and got written acceptance from the first lender! YAY!

The first lender, Wells Fargo, issued approval and offered $3,000 to GMAC, the second lender. Within a week of Wells Fargo's acceptance, GMAC stated they wanted 10% of their loan balance. This was approximately $7,000.

Ordinarily, there are ways to close a gap of this nature and close the short sale. The buyer can absorb this additional $4,000, the agents can reduce their commissions, or the sellers can make a cash contribution to close the transaction - or any creative combination of the three. Easy, right?

Wrong. In this instance, Wells Fargo's approval documentation specifically stated that GMAC could NOT net any more than $3,000, and that any additional proceeds from the sale were due to Wells Fargo. HMM...so after trying to find a way around this, getting my broker and the listing agent's broker involved, our legal counsel to review all the documents, lots of 3-way calls, etc., we had to go back to the negotiation table with both lenders in an attempt to get Wells Fargo to offer GMAC more, or for GMAC to accept less.

The result? A stalemate. Neither short sale lender would budge.

My buyer client was frustrated, but absolutely determined to purchase this house. My broker and I actually encouraged my client to move on and look for another property. They would not have any of that, and wanted to press forward with more negotiation. OK.

Let me explain...as a short sale listing agent myself - it is very difficult to sit on the other side of the transaction with my hands completely tied. I of course as the buyer's agent had zero influence over the transaction, and it absolutely made my skin crawl. Luckily the listing agent's assistant was open to collaborative strategizing...but still, I was not directly involved with the negotiation. UGH.

So back to the drawing board we went...Wells Fargo was absolutely unwilling to decrease its NET proceeds from the sale to allow GMAC more money. So we all put our heads together again and got creative. Over time we convinced Wells Fargo to allow the seller to pay some of the $4,000 deficit to GMAC, and to allow a slight commission reduction to increase the payoff to GMAC.

Finally, we got both lenders to agree at the end of June! Yippee!! The short sale was accepted, and my buyer clients were really happy...until...

Remember how we had offered about $11,000 more than the asking price on the home because we had been in a competitive offer situation? At the time we made the offer, there were recent comparable sales to support this higher offer. Well folks - comps only live for 90 days. By the time the short sale was approved, there were NO comps. This house was a bit unique. It was in a neighborhood of custom homes on large lots, but it was surrounded by tract homes on small lots. The only comparables were tract homes. The appraisal came in $53,000 below our contract price.

We had no choice but to go back to Wells Fargo and ask them to reduce the approved price. They had been so steadfast about not reducing their NET payoff to give GMAC another dime, we were all nervous that Wells Fargo would hold out for their approved price.

Hurry up and wait again. The buyer had already waited about 3.5 months, and between the appraisal and various inspections had spent about $1,000 out of pocket. They had also been able to lock an insanely low interest rate at 4.75% that was potentially jeopardized if escrow did not close within a certain timeframe.

More waiting...more waiting...after about 4 weeks, we finally got some good news that the file had been successfully escalated to management. This new person working on the file worked an overnight shift - 3pm to midnight. On Friday afternoon, August 28th, the listing agent's assistant emailed me that the file was under management review, and we could expect an answer "soon."

"Soon" turned out to be the afternoon of Monday, August 31st!! The written short sale approval from Wells Fargo magically appeared in my inbox! The next morning on September 1st, GMAC's new short sale approval also arrived!! My clients were approved at $307,000 to purchase a property they had originally intended to pay $360,000 for.

Needless to say they were absolutely ELATED! Their loan officer had literally everything in place so that when the new short sale approval arrived, she was able to have loan documents sent to the title company within 24 hours. She also was able to preserve their really low interest rate lock at 4.75%! My clients signed their loan documents on Tuesday afternoon....the loan funded on Thursday morning!

I am so glad that after all that turmoil and waiting they were able to close escrow. I personally delivered the keys with a bottle of champagne! I will actually miss our regular phone calls...I know they will be very happy there!

I did the happy dance in my office briefly today! This morning, after multiple phone calls, hair pulling, sleepless nights (yes, I have literally been having nightmares about this short sale transaction), I received a written short sale approval extension for my transaction that was supposed to close on 8/31! WHEW!

So of course, I excitedly emailed it to the buyer's loan officer, buyer's agent, the seller, the escrow officer at Placer Title...this short sale extension is valid through 9/18/09! YAY! Mission accomplished, right?

WRONG. A few hours later, I received a call from the buyer's loan officer that there is one sentence in the short sale approval extension letter that the buyer's lender wants removed before they fund the loan. WHAT? This same sentence was in the original approval! Couldn't you have brought this to my attention BEFORE NOW!???

So, my quest continues. GRRR...

If you read my post last week regarding the fact that short sale approval extensions are just not guaranteed, keep reading...and if you did not read that post, keep reading anyway.

Approval for this particular short sale expired yesterday on 8/31/09. The buyer has not been able to perform and close her loan. In fact, as of yesterday (and thus far today), the buyer's loan documents have still not been received by Placer Title. UGH.

A Trustee Sale (foreclosure...the end of the line...auction on the Sacramento County Courthouse steps) had been scheduled for 9/8/09 - next Tuesday, right after the Labor Day holiday.

Well today, I won a small battle in my quest for a written short sale approval extension. While I have not yet received a written short sale extension, granting us extra time to close the escrow, I was successful in my request to postpone the date of the Trustee Sale from 9/8/09 to 10/1/09. WHEW!!

So my battle continues...at least at this point my listing will not be foreclosed out from under the transaction, and with continued hard work, phone calls, and hair pulling - we may just get this short sale transaction closed yet! What an emotional roller coaster for the buyer ane seller!!

I received a call last week from a client who wanted to inquire regarding the legitimacy of a company promising to drastically lower his property taxes for a $495 fee. I have posted about this before - so folks please be very aware that there are many "Property Tax Reassessment Service" scams. If it sounds too good to be true, it probably is!

If you receive something in the mail that looks official regarding a fee-based service that promises to lower your Sacramento County property tax assessment - please be aware that this is NOT legit! Do not provide any credit card numbers or private information, or if you have mailed one of these companies a check - cancel it asap!!

Sacramento County released a couple months ago its list of reassessed parcels...they have since taken that list off their site, however you can look up your current tax assessment on the Sacramento County Tax Assessor's website here. If your property was not reassessed, and you think it should be, we are currently right in the middle of the appeal application submission time period. You can download the Sacramento County "Decline-In-Value Request for Assessor Review" application and submit it yourself. You MUST file this form by November 30, 2009. The application will ask you to provide 2 comparable sales from the time period from November 2008 - March 31, 2009. Your tax basis for tax year 2009-2010 is based on your property's value in January 2009. If you need sale data from that time period for your application, feel free to email me at erin@erinattardi.com, and I am happy to provide it to you.

Now - having said all that, there is ONE legitimate fee-based re-assessment service that I know of. It is a service by a CA licensed appraiser, and his fees are not excessive. If you are interested in having someone prepare the application for you, email me and I can give you his information.

Very infrequently do I take full weekends off, but this weekend was one I had been waiting for with much anticipation for quite a while! If you follow me on Facebook or Twitter, you will know I had an eventful weekend away...
My husband and I checked out bands like Pearl Jam, Black Eyed Peas, Dave Matthews Band, and others at Outside Lands. It was a great, multi-stage concert in Golden Gate Park...if you had not had the chance to go, and like a huge variety of great music, I highly recommend checking it out next year. It is also a fabulous people-watching opportunity...I linked a photo on Twitter showing a crazy marching band of mimes...
Not only was this the weekend of the Outside Lands Festival in San Francisco, but the San Francisco Giants were playing a pivotal series against the Colorado Rockies!! We checked out the final game of the series yesterday, and the Giants won 9-5 in a come-from-behind victory! They are now tied in the NL Wild Card standings...nail biting for the rest of the season...Go Giants!!