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Equator Starts the Day for a Sacramento Short Sale Agent
When it’s 5 AM in Sacramento, it’s 8 AM on the East Coast. I get a head start on my day by updating my Sacramento short sales before people start calling. However, I am finding it is increasingly difficult to write my blog uninterrupted on a Tuesday morning because all of the short sale negotiators in Equator are up and at ’em first thing. It’s like they don’t touch their computer all week or something. They wait until Tuesday. My inbox begins dinging with Equator emails at 5 AM. I could not imagine looking at a file only once a week, but that’s how some short sale negotiators seem to handle their workload.
Many short sale lenders are using Equator now for processing short sales. We’re all anxiously awaiting for JPMorgan Chase to join Equator but it doesn’t seem to be happening. I keep hearing rumors that Chase will be on Equator. First, it was last summer, then by this fall, and it’s just not a reality yet. But we do have the top 4, which are Bank of America, Wells Fargo, GMAC / Ally and Nationstar.
The thing with Equator — as I was explaining yesterday in my presentation to the ballroom of agents at Lyon Real Estate’s FRED (Fun Realtor Education Day) event — is it over communicates. It used to send agents emails containing specific messages and those messages were also kept in a property folder on Equator. Now, for some reason, Equator generates an email to tell a Sacramento short sale agent that there is an email in Equator. And when the agent gets to Equator, the email directs the agent to a task. Except the task is not really always a task. I prefer the old method because I knew what I was getting into before I got there. It’s not always worth it to open Equator. Sometimes, the messages are pointless.
Not only are some of the messages pointless, the messages can also be “system generated.” A system-generated message will say things like somebody is reviewing documents. But nobody is really reviewing documents. Yet, I am not about to complain about Equator. No sirree. I know what life was like for this Sacramento short sale agent before Equator, and I never want to go back there.
It’s bad enough that I have to work on Bank of America FHA short sales outside of Equator. I don’t wish that horrible experience on any short sale agent. I love Equator and an Equator short sale. I am Equator Platinum Certified, not only for short sales but also for REOs. I received certifications for both. I don’t handle REOs, but you never know, one day I might. I have belonged to Equator since its transformation from REOTrans. It’s a lifeline for Sacramento short sale agents.
Bank of America Cancels a Short Sale
This Sacramento short sale agent spotted a freaky warning in Equator yesterday about how Bank of America cancels a short sale. It’s a Cooperative Short Sale. My seller is receiving more than $10,000 to do this Sacramento short sale. It’s been smooth sailing for her from day one — no financials, no hardship letter — and the docs are in title, knock on wood. The warning was from Dignified Transition Solutions (DTS) and read: LOANS ARE MORE FREQUENTLY BEING SERVICES RELEASED FROM BANK OF AMERICA, WHICH WOULD VOID THE DEAL. This means exactly what you think it means. It means that even though we have short sale approval and are about to close escrow, Bank of America can cancel the short sale.
The buyer has completed all of her home inspections. She paid for a lot of inspections, too: roof, chimney, general home inspection, pest report. Yeah, yeah, I know what you’re thinking. You’re thinking so what, the buyer does not have a contract with Bank of America. The buyer has signed a purchase contract with the seller, and that purchase contract is contingent upon bank approval of the short sale — even though it is a preapproved Cooperative Short Sale, the bank still needs to approve the purchase offer.
Yet, you probably wonder how can Bank of America cancel a short sale? The bank is not the investor. This is the little known but all-important fact in most short sales. Often, the bank is only the servicer, it services the loan, collects the payments (or non-payments) and disburses the money on behalf of the investors. Investors are increasingly pulling that servicing from Bank of America.
I had another Bank of America Cooperative Short Sale yanked by the bank right after the Equator counter offer. Here, we were waiting for what we so innocently presumed would be the short sale approval letter when we were abruptly notified that Bank of America was no longer servicing the loan. It had been transferred to our buddy, Seterus. Which was once, believe it or not, IBM. What a sad graveyard for typewriters and a former technology giant. We started the short sale over from scratch with Seterus. No cash for this seller. No guarantee the short sale will be approved again, either.
Another Cooperative Short Sale at Bank of America is destined for another servicer as well. We went back to the bank negotiator to ask for a short sale extension and were informed the file was being held, pending a servicing release. At least the bank had the decency to hold this pending release but it’s also now being released. This investor is Fannie Mae. I don’t know who the other investors are in my other Cooperative Short Sales — just that those investors are not a government sponsored entity (GSE) like Fannie Mae. That information is unavailable. I do know that we have Fannie Mae saying: Adios, B of A. And don’t let the door hit you in the butt.
Still, the question is how can Bank of America cancel the short sale just before closing? Like with most things, the answer lurks in the legal documents. In the short sale approval letter, Bank of America says, “We may terminate this agreement at any time if we have evidence of: blah, blah and
“The transaction does not comply with our requirements, policies and procedures.”
If Bank of America is no longer the servicer, you’re hosed. So, the moral of this story is it ain’t over until the fat lady sings. Until you close escrow, that Cooperative Short Sale at Bank of America could be at risk.
Why the Seller Didn’t Take Your Purchase Offer
Don’t give sellers a reason to reject your purchase offer. Not in a seller’s market like our present real estate market in Sacramento. Don’t give them one little reason. The thing that buyers don’t realize is when a listing agent is reviewing offers with the sellers, they are probably looking for a reason to reject. They are not looking for a reason to accept. That’s because most homes right now are attracting multiple buyers.
If you’re buying a home in Sacramento, you want to make your offer stand out but not in a bad way. You don’t want your purchase offer to be the only offer, for example, that asks the seller to give you the refrigerator. A smart buyer makes no demands on a seller. A smart buyer makes the offer easy for the seller to accept. This is not the time to ask the seller to pay for a home warranty or to demand that the seller in a Sacramento short sale, for instance, not send any other offers to the bank.
Realize that a Sacramento home buyer is not in a position to make demands today. Don’t stand out like a sore thumb.
For one thing, I don’t know of a single Sacramento short sale agent who would send more than one offer to the bank. It’s just not protocol. The only reason to ever do that is if the initial offer is too low. As long as a buyer’s offer is sufficient and would be acceptable to the short sale bank, only a short sale agent with sadistic tendencies would advise a seller to send more than one offer to the bank. It’s unwise to insert any clause apart from the norm that would make your purchase offer stand out in a negative way.
I promise you that if you offend the seller, your offer won’t stand a chance in a blue moon. If you’re not getting offers accepted, there might be a burr wedged in your offer somewhere.
Bank of America Fannie Mae Cooperative Short Sale
Why would Bank of America issue a denial for your Fannie Mae Cooperative Short Sale? It might astonish you to learn that not every Bank of America loan will qualify for the Cooperative Short Sale process simply because your home is underwater and the investor is Fannie Mae. Moreover, at any time in the short sale process, even if you’ve signed a Borrower Acknowledgement of Interest, Bank of America can still yank out that rug from under you. As a Sacramento short sale agent, you would not believe the things I witness first hand. But then, I close a lot of Bank of America Cooperative Short Sales in Sacramento. Sooner or later, I’m bound to see a lot of crap.
Just last week, I accepted a counter offer in Equator for a Bank of America Fannie Mae Cooperative Short Sale. Typically, this is the point in the short sale when, shortly thereafter, the approval letter arrives. I thought the short sale was finished and we were about to close. Nope, next thing I discovered Bank of America denied the Cooperative because, low and behold, Fannie Mae released Bank of America as a servicer. Now, Fannie Mae has supported Cooperative Short Sales at Bank of America in the past. This was an odd move, from where I sit. So, since Bank of America was no longer the servicer, the short sale will have to start over through the new servicer, which is no stranger to short sales, Seterus. Don’t even get me started on Seterus. That’s another blog.
In another Fannie Mae Cooperative Short Sale, we have a problem with the second lender, which won’t back down to Fannie Mae’s demands. This is another file in which Fannie Mae is about to release Bank of America as the servicer and hand over the file to somebody else. Why is Fannie Mae dumping these Bank of America files? One would think that files in the middle of a short sale would receive some kind of priority. In any case, this is one reason your Bank of America Cooperative Short Sale could be denied — because Bank of America is no longer the servicer.
It’s just been the last 30 days in which I’ve noticed a change in the Fannie Mae Cooperative Short Sales at Bank of America. Generally, Fannie Mae will authorize a higher payment for the relocation incentive than a traditional Cooperative Short Sale, which is $3,000 vs $2,500. Then, if you get the HIN Incentive, that could bump up the cash payment tremendously. I have some clients who qualify for both incentives and are getting paid $15,000 or so.
On the other hand, the other GSE, Freddie Mac, does not participate in Bank of America’s Cooperative Short Sale. You would think whatever guidelines Fannie Mae comes up with would be followed by Freddie Mac, but it doesn’t always work that way. It doesn’t work that way in a HAFA short sale. A Freddie Mac HAFA short sale is very different from a Fannie Mae HAFA. This means if your loan is held by Freddie Mac and serviced through Bank of America, you cannot qualify for a Cooperative Short Sale.
I discovered an Elk Grove short sale would not qualify for a Cooperative as well because the investor was Aurora. The homeowner thought that Bank of America was the investor. Morever, Aurora says it has a policy that if the homeowner has filed for bankruptcy and completed a bankruptcy, it won’t let the homeowners participate in HAFA. The devil is in the details. The devil is always in the details, which is why it’s a good idea to hire a Sacramento short sale agent with experience. Why take a chance on a denial letter for your short sale?
And be careful if you’re trying to pursue a Cooperative Short Sale through Bank of America in which Fannie Mae is the investor. Although, this is only a few short sales in which Fannie Mae has released Bank of America as the servicer, it could be the initiation of a new policy. Even scarier is the fact there is a huge profitable market for buying and / or insuring bad loans. Not much has really changed, you know. But that’s a blog for another day.
When Does a Sacramento Short Sale Agent Quit?
Before I talk about when to give up on a Sacramento short sale, let’s look at attitudes. A person’s attitude affects everything a person does and how that person is perceived by others. A person can choose to be happy or miserable; nobody can make you miserable without your own permission. I will give you an example. OK, it’s kind of a funny example but what else do you expect from a loopy Sacramento short sale agent?
I read the birthdays in the paper. The Sacramento Bee lists the oldest people first and whittles that list down to the younger people or, as I view them, the insignificant. Hey, I’m not an ageist, it’s just that I have learned to stop reading the list when I get about 20 years past my own age. That’s because there are some birthdays of celebrities which make me feel good about my own age and some that do not. I use those dates as a measuring stick because I don’t have any kids who do that for me.
Donna Douglas, for instance, from the Beverly Hillbillies, was born in 1933. The fact that she is 79 now makes me feel happy and hopeful. Brigitte Bardot is 78. Raquel Welch is a youngster at 72, and Jane Fonda is 74. On the other hand, you’ve got Janeane Garofalo at 48, Brook Shields, 47; and Molly Ringwald, 44. How did those women get to be so old so fast? Oh, wait. They are all much younger than me. Which makes me, at 60, ancient, older than dirt. No, that doesn’t induce warm, fuzzy feelings. So, see, I just stop reading when I get to the women in their 40s.
But when it comes to Sacramento short sales, I never stop. I never give up and throw in the towel. And I always try to keep a positive attitude because it affects the outcome of my work. That’s the secret to being a successful Sacramento short sale agent. Not every agent in Sacramento is cut out to do short sales. Some of my closings are littered with failed attempts by others in which I was successful and they were not. I was successful because I didn’t quit.
I will argue with short sale bank negotiators until the cows come home. If a short sale gets rejected, it’s just one step closer to acceptance because I’ve eliminated that particular path. Other agents don’t understand nor embrace this attitude. I know this because I often spot their withdrawn and canceled listings in MLS, and I wonder why they gave up. Only a rookie quits. Very few banks refuse to do short sales nowadays. They aren’t going to spell it out for you but there are ways to close even the most stubborn short sales.
It’s best to hire a Sacramento short sale agent who sees the glass as half full. My performance is living proof of that. My production is more than $25 million in sold and pendings already this year. Hey, Lauren Bacall is 88. You know how to whistle, don’t you?
