Email Elizabethsacramento short sale realtor
Can This Sacramento Seller Qualify for a Short Sale?
You may find this surprising to hear, but this Sacramento Realtor takes the time to analyze her sellers before listing a home for sale and she makes sure the sellers qualify for a short sale. I realize it looks like I never say no to anybody, but that’s just because I list and sell many, many homes in Sacramento, including some short sales. I will take just about any listing but I do subscribe to set criteria: I’ve got to believe the home will eventually a) sell, and b) the seller can’t be crazy nuts, like Dr. Jekyll and Hyde personalities.
The Sacramento short sales in particular require special attention because they require so MUCH extra work and time. You can bet I make sure my sellers can qualify for a short sale because that will ensure that my short sales will get approved. I’ve worked on short sales now for going on 10 years, and I’ve sold and negotiated more than any other short sale agent in a 7-county area. I stay abreast of new developments, laws and legislation, lender requirements and, quite frankly, there is not much I do not know about short sales. For a person who once said she didn’t have anything more to say about short sales, I’ve written 150+ articles, a book and goodness knows how many thousands of blogs and online tips.
Sometimes, I have to say no to a short sale. Not every seller will qualify for a short sale. Like yesterday, a nice fellow called to ask me about listing his home in Natomas. A quick search while he was on the phone with me revealed he travels the world, has built a home in the South Pacific and presently lives in a home he owns in Elk Grove, an Elk Grove home with lots of equity. Although he continued to insist that he lives in the home in Natomas and, when I mentioned the disparity, he claimed to live at both homes. Which I suppose he could, maybe he has more than one family, I dunno, but I don’t believe a short sale bank will buy it.
The best chance to qualify for a short sale is to have a financial hardship. The worst thing is to have excellent credit, lots of disposable income, and the ability to pay on the mortgage. Upon closer examination of this guy’s situation, it was apparent to me that we could sell his home in Natomas and he’d be short about $10,000, after all the costs of sale and existing loans were paid. For THAT he wants to short sale? It’s not worth it. He’s got the ten grand, and, upon review and confirmation, it would not be a huge sacrifice or stretch to just pay the difference.
But people have to make up their own minds what to do. I should charge for my advice but the BRE seems to frown on agents charging for advice when it’s not part of a sale. The financials the bank will pick apart should negate any chances of short sale for this guy. I work with more sellers lately who pay the difference and don’t short sale because the gap is becoming increasingly smaller, thanks to our recovering market.
My reputation is also at stake. I don’t want to put a buyer and her agent through waiting 90 days for approval and not perform. My short sales close. Because I qualify the seller. And I give straight-up advice. If it’s unlikely to work, I’ll tell you. My advice to other agents is to think through the short sale and seek out a short sale expert if need be, and don’t just throw every seller into MLS because they ask. Buyers, look at the track record of the Sacramento short sale agent before committing to buy a short sale.
When a Short Sale Buyer Blows Off a Nationstar Auction . . .
There are benefits to registering for a Nationstar short sale auction.
This is a story of a Nationstar short sale for which the buyer did not register during the online auction and, as a result, did not participate in the online Nationstar auction. I always advise in-contract buyers to register for the online auction and to place a bid, even if it’s the identical amount that they’ve already offered, during the last few minutes of the auction. There are advantages. First, no 5% premium applies to a buyer who is in contract with a seller to buy a short sale. Second, upon winning the bid process, Nationstar promptly issues an approval letter within the week — OK, maybe another week or so when the investor is Fannie Mae, but still.
These particular buyers did not want to participate in the online auction. OK, they don’t have to. Nationstar doesn’t force them to register nor to bid. But the consequences that happen when they don’t is the approval process starts over and can take another 3 months to obtain the approval letter.
My experience has shown that a Nationstar auction typically doesn’t get a lot of action, especially when the reserve price is set so much higher than the initial starting point. I heard that N.A.R. has stopped shill bids from Nationstar now, so that helps as well. Plus, when you have Fannie Mae as the investor, you can be fairly well assured that Fannie Mae will set a reserve price on the high side of market. But buyers don’t always listen to the listing agent’s advice.
We had already lost one buyer in September who had made an offer and then immediately reneged. Some lame excuse about his parents not wanting him to buy a home. When my seller finally entered into a purchase contract with our new buyers, it was October of last year, a few weeks before Halloween. The Nationstar auction process did not take place until the last few days of December, that quiet time between Christmas and New Years when I flew off to Vanuatu, probably the very worst time of the year for an auction. But like I mentioned, the buyer did not register for the auction.
Green Tree was the second lender, the collection agency that has made enormous profits buying bad paper. Green Tree had previously issued approval, but since Nationstar had dragged its feet on the process, that loan went to charge-off status. Now, Green Tree wanted more money. On top of this, Nationstar came back to say Fannie Mae would not approve the buyer’s closing cost credit, and raised the sales price.
All of this happened because the buyer did not bid at the auction. Good thing the buyer still wanted the property from my seller. Six months from the date of the purchase contract we closed, and the buyer had to pay a higher price, plus wrap the closing costs into the loan. The moral of this story is if you’re trying to buy a short sale and are faced with an online auction from Nationstar, you may want to register and participate. You have nothing to lose but time. And quite possibly, money.
Story of an Elk Grove Short Sale With Nationstar Auction
This is an interesting allegory of an Elk Grove short sale that survived two auctions directed by Nationstar. First, let me say that the very nature of short sales can sometimes mean the listing agent will be forced to sell that home 2 or 3 times. The reason for multiple resales has nothing to do with the negotiations, sellers or listing agent. It is almost always caused by the buyers. They flake out. Cold feet. Change their minds. Find something else. Move away. Lose jobs. Indigestion. Whatever.
The first time I sold this home in Elk Grove, it was to a buyer who also had a home to sell and wanted to present a contingent offer. While there are ways to accomplish this feat, a contingent offer is not always your best bet because, if short sale banks catch wind, they tend to reject those arrangements. A smart Sacramento short sale agent realizes this. The agent found a buyer for the buyer’s home almost immediately, and this buyer entered into contract to buy the Elk Grove short sale.
Nationstar could not bring the home to auction for more than 3 months. Much of that time was spent arguing about the health of the sellers, which was dire, and their ability to survive that sort of thing. In the past, we’ve been successful with a strong defense against the Nationstar auction and could opt out, but not this time. We also had to escalate the short sale several times because of non-action on the part of Nationstar.
The buyer registered for the Nationstar auction, even though the buyer was under contract, because the buyer was worried about losing the home. Another buyer would need to pay a 5% premium to Nationstar, but a buyer under contract is exempt, so this buyer had nothing to lose by registering. Except by the time the auction rolled around, the buyer grew more anxious and nervous. Near the end of the auction period, Nationstar, we suspect, submitted a shill bid. This is a phony bid designed to encourage panic in the original buyer and result in a higher price. Until recently, this was a legal practice on behalf of Nationstar.
The shill bid by Nationstar caused the buyer to push up the price another 3% or so. The auction ended and our buyer won. We received short sale approval within a week. Shortly after entering escrow, the buyer canceled. Something about realizing the roof had to be replaced, which was always an existing issue and made clear. The buyer who was purchasing that buyer’s home was devastated and crushed because now that sale fell apart. We put the home back on the market.
See, the thing is this home was priced about $100K under its value, maybe more. It was in line with the comparable sales, which was how we could get it approved by the bank, but its actual value was considerably more. The neighborhood is high demand. End of a cul de sac, too, which is always a premium in Elk Grove. Sometimes I get these kinds of listings, but the pricing is typically geared toward what the bank will accept, which needs to match the comps.
Sure enough, an astute real estate agent came along who recognized this excellent value and put in an offer at list price for a cash investor client. While this happened, we also received a bunch of lowball offers from idiots. I don’t know why comps aren’t run at times but these are the guys whose M.O. is to throw offers at the wall to see what sticks. They don’t do their homework, so they miss out on good deals by just lowballing whatever the price seems to be.
Second time around with Nationstar took a month longer than the first time, and there was no argument about the auction. Nationstar held the auction and nobody bid. The buyer did not register for the auction. We were informed that because the buyer did not register nor bid, the short sale would start over and we would not receive an approval letter a few days later like we did the last time. Buyers should be aware that this happens. It takes longer for approval, so my suggestion is to register and bid, at a minimum, your purchase price contract amount to speed up the approval process.
On top of this, at the last minute, Nationstar decided to offer considerably less to the second lender, Bank of America, and the second bank would not budge from its demand. Bank of America said no to the offer. Ordinarily, in these situations, there are ways to bring the banks to an understanding. However, that procedure involved a lot more time and the sellers had already found a place to move. Anybody who knows me well knows my compassion but I am also astute. I don’t give away my paycheck. I work too hard. It is very rare for me to kick in cash to close a transaction, but every once in a blue moon it makes perfect sense, especially when the clients’ needs take precedence.
Many people don’t know it is against the Code of Ethics to ask a buyer’s agent to reduce the selling end commission. Yet, there are also ways to encourage a buyer’s agent to participate in a cash contribution without directly asking the agent to do it, but I decided just to pay the difference myself. It was expensive but worth it for my clients. Both of the banks allowed this hijacking. I absolutely will not pay a guy’s child support, however; and I’ve been asked, if you can believe it. But these sellers were unlikely to find another place to move that met their specific needs, the negotiator at Nationstar was not very cooperative and sometimes vanished for days, and this needed to end. It was in my power to make it end. So, I did.
Ten months of hell. Over. Clients: extremely grateful. That’s the silver lining.
Ways to Know a Bank Will Approve the Short Sale
Buyers who plan to buy a short sale in Sacramento should receive some kind of assurance that the bank will approve the short sale. In other words, the odds should be in their favor, especially if they have to wait 6 months for an FHA short sale or 90 days for most other short sales. If a buyer is to invest that amount of time, wouldn’t it be nice to know whether the bank will approve the short sale?
For starters, a buyer can approve the odds by buying a short sale listed by an experienced Sacramento short sale REALTOR. By experienced, I mean the REALTOR has a long track record of closing many short sales, not just a handful. It seems that some agents close one or two short sales, and granted it can seem like a lifetime, but two short sales does not make an agent an experienced short sale agent. It makes the agent somebody who ventured into short sale waters and came out without drowning or getting shot, a note-worthy accomplishment but it doesn’t mean much.
Some agents will list a property as a short sale simply because the seller asked them to do it. They never ask the seller if there is genuine hardship or qualify the seller at all. Some agents don’t even negotiate their own short sales. Not really knocking the third-party negotiators, but they don’t seem motivated by the time is of essence urgency that listing agents tend to possess. It’s often just another file. But I think buyers would rather see the file with a third-party negotiator than with an agent who doesn’t know what he or she is doing. Still, all in all, buyers are typically better off if the listing agent negotiates the short sale, has experience and has qualified the seller.
I can say all of this because I’ve sold hundreds of short sales and negotiated tons, more than any other Realtor in a 7-County area in Sacramento Valley since 2006. When I spot a short sale in MLS that is pending short lender approval but is mispriced, that’s a pretty good sign the short sale will end up back on the market at a much higher price or simply rejected all together. The mispricing is typically too low. I don’t know where agents get some of these prices — I think they pluck numbers from thin air, hoping and praying in vain. Banks want market value. End of story.
If you’re searching for a Sacramento short sale agent, call Elizabeth Weintraub at 916.233.6759. If your short sale is doomed, you can trust that I won’t list it. My short sales close. Can’t recall that I have ever lately had a bank reject a short sale. You can put faith in the odds that the bank will approve the short sale when you’re buying a short sale listed by Weintraub.
Why Would an Agent Sell Short Sales?
You might be one of those people who could not in a million years fathom why a Sacramento short sale agent would want to specialize in short sales. There are days I ask myself that question. And there is nobody to talk to about it. My husband doesn’t want to hear it. He doesn’t want to hear it any more than my other types of complaints such as why can’t I buy pieces from the new Eileen Fisher Resort Collection at the Eileen Fisher website? Why can’t other department stores such as Macy’s, for example, sell Eileen Fisher online?
Here you have a designer with her own website and she doesn’t sell all of her designs on her own website. Not only that, but you cannot buy those designs on any other website. It’s like a big secret. They send out a catalog but consumers can’t buy featured items. How sneaky is that? What you have to do is call Eileen Fisher to find out which department stores near you carry which particular garments, and then call those stores to order. You would think it would be difficult for Eileen Fisher to increase her sales volume in that manner because, let’s face it, it’s kinda nuts.
But I accept that because I sell short sales, I guess. I am surrounded by insanity. I seem to function well in that kind of environment, which is kind of scary when you think about it, not to mention, it makes me want to go screaming into the street. Yet, I seek out that kind of frustration through the very act of accepting short sale assignments and listings.
For instance, I am well aware of the torture of a Bank of America FHA Short Sale. Still, I continue to list and sell them. I can’t stop. I know I shouldn’t look at a train wreck but I do. Just yesterday a negotiator told me that her QA department would kick out a HUD because it was drawn in accordance with RESPA. Apparently, Bank of America thinks nothing of violating RESPA. It routinely tries to change the way items are listed on the HUD — and are required by law to be listed on the HUD when the buyer obtains financing. It makes me wonder how does she ever do any FHA short sale for Bank of America when she cannot read a HUD? Does she make the other agents she deals with so frustrated that they end up breaking the law just to stuff a sock in her? How does she keep her job?
Moreover, where does Bank of America find these people? Do they pull them out of soup lines? Hire them out prison mail rooms? What hideous crime must a person commit to go to work on FHA short sales at Bank of America? Whom do they need to offend to be demoted to the FHA short sale team?
I suppose they could go to work at CCO, but then they would suffer a worse fate because they would have to live in Tennessee. A negotiator at CCO told me yesterday she received permission to look up the sellers’ loan on the Fannie Mae website but it was not listed there. Except that it was. I’ve been telling her for 2 months the seller has a Fannie Mae loan and, as such, Fannie Mae will not authorize a payment above $6,000 to the second lender. I sent the negotiator the preapproval letter from Fannie Mae on Fannie Mae letterhead, but that was not good enough. Finally, I downloaded a screen capture of Fannie Mae’s Loan Look Up website that showed the seller’s name and address to prove that it was indeed a Fannie Mae loan. I turned the screen capture into a PDF and sent it to CCO. The approval letter appeared like magic moments later.
See, that’s how I do it. Eventually things work out. Eventually they see the light. It doesn’t mean they will change. I’m not looking for anybody to change. I just want that short sale approved. My sellers are counting on this Sacramento short sale agent to be successful for them. I am not about to let them down.
