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Three Sellers Approved for Three Sacramento Short Sales
You know that expression: when it rains, it pours? Often, these little bits of wisdom extracted from life and handed down over the years from generation to generation are based in some kind of truth. Yesterday was one of those days. This Sacramento real estate agent received short sale approval letters on three different short sales in the Sacramento Valley.
As usual, something was wrong with each file. Things are rarely perfect in the business of Sacramento short sales. Agents who expect perfection are those you find hunched over hugging their knees in the corner, rocking back and forth and singing to themselves.
In one file, the lender reduced our commission. This file is a HAFA short sale. Our listing agreement was signed way before the short sale approval agreement arrived. The bank told me that its investor only pays a reduced amount, and that they’ve always handled their HAFA short sales in that manner. They’ve always done it because no other short sale agent challenged the bank — that’s how they get away with it. If they don’t authorize the rightful commission, the Treasury Department won’t pay them; we’ll see how they like that.
The bank can ignore the MHA handbook and the CAR explanation of HAFA rules, but they can’t ignore Laurie Maggiano, the Director of Policy for the U.S. Treasury. They coughed up the commission.
In another file, we need a final court document to close. We’ve been trying to get this court document since October. The case was settled two years ago. The sellers’ lawyer keeps saying it’s coming and she will get it, but it’s not coming and she doesn’t have it. The clerks at the court are taking their sweet time, too. Now that we have the approval letter, the clock is ticking. We might have to call the court every single day until we get the letter. Persistence is my middle name. Hey, I close more Sacramento short sales than any agent I know.
And in the third, Bank of America took so long to get us the HELOC short sale approval letter that we’ve had one short sale approval letter and one extension already from Seterus. Usually, Bank of America is pretty fast. Especially since they use Equator. I am busy today trying to figure out what took them so long with this particular file so we never repeat it again. Seterus refused to issue a third letter until we received the approval from Bank of America, and who can blame them? Not me.
Overall, yesterday was a great day. Three short sale approval letters in one day, and 3 more files headed for closing. Three more Sacramento short sales are over. More happy, happy sellers and buyers!
Should You Do a Loan Modification or a Sacramento Short Sale?
Many underwater sellers in Sacramento, by 2013, have most likely tried to do a loan modification or have successfully closed on a short sale. I suspect most of the extreme financial hardships have been resolved and the strategic short sales have been executed or denied by this late date, because many homes have been underwater in Sacramento since 2005-2006. That was the first wave. The next big decline happened in 2008.
Five to 9 years is a long time to struggle with an underwater home. Because of today’s marketplace in Sacramento, some of the borderline underwater homes are turning into equity sales. However, if your home value has fallen by 50% or more, I don’t see any hope for you. Can’t sugar coat this. You won’t regain that equity in my lifetime. There are basically 3 ways out and with few exceptions, only the short sale is the permanent solution.
You either do a HARP refinance (if your loan is Fannie Mae or Freddie Mac) a loan modification or a short sale. If you do a loan modification or a refinance (with the refinance really being a loan mod in disguise), the only thing that really makes sense is if the lender will reduce your principal balance, erase a good chunk of it. Because if not, you’re simply reaffirming a humongous debt that you’ll never ever repay unless you live in that house until you die. And even then, you’ll pay twice as much as you needed to pay. Most banks will NOT reduce a principal balance.
You might wonder why would banks give you a HARP refinance or a loan modification if it wasn’t a good deal for you? Because they don’t give a crap and they want to stop their own bleeding. Banks don’t really care about you. They care about their stockholders and whether the government will continue to sue them, and all sorts of others things, but not you.
You also can’t pursue a loan modification when you’re trying to do a short sale. I had an investor client start out to do an FHA short sale about 6 months ago. We were getting him preapproved for the ATP before going on the market. Mid-stream, ?he decided he wanted to do a full-blown loan modification, so we had to drop the short sale. Not only that, but he was advised not to do the loan modification because he did not live in the property, and FHA will not do a loan modification for a homeowner who does not reside in the home. I sent the homeowner the HUD guidelines, which clearly stated such, but he wanted a miracle and was hoping for something magical to happen. I understand that homeowners are confused and directionless at times.
His loan modification was denied, of course. But getting that denial did make it easier to get him the Approval to Participate in an FHA short sale. I am working with several other sellers who were granted loan modifications and are now waking up to the fact that they will never get out from being underwater. They will always owe all of that money! And some of them no longer can afford to pay the minimum or reduced payments under the loan modification.
The Rip Van Winkle loan modifiers in Sacramento are waking up. That loan modification is not a very good deal for you, is it?
If you’ve got a loan modification that is cause for concern and you want to dump that home so you can buy the same type of home again in two years and be done with this mess, call me. I can put an end to this suffering. I’ve been doing Sacramento short sales since 2006 and have closed hundreds. Last year, I sold $32 million. Call Elizabeth Weintraub at 916.233.6759.
Have Sacramento Short Sales Dragged Down the Market?
People think that short sales are dragging down the economy in Sacramento and messing up neighborhoods, yet little is further from actuality. Sacramento short sales are turning around neighborhoods and revitalizing entire pockets of homes that have been drowning underwater for years and years. In some areas, especially among neglected, board-up homes, a short sale is a chance for that home to live again, to bring life to itself and make a welcoming home that will begin to build memories for some lucky first-time home buyer.
I am on the tougher end of the rope, the more difficult side of the transaction, because I work on hundreds of Sacramento short sales. I’ve heard it rumored that some real estate agents have pointed to me and scoffed to their clients, saying I can’t sell traditional homes, although it’s not true because I do. I sell a lot of traditional homes with equity in the four-county area. They seem to believe, whether it’s through spite, green-eyes or ignorance, that an agent who is very successful at selling Sacramento short sales should never sell a regular home, and that’s pretty insane. Just because they can’t do two things doesn’t mean they should point fingers at those of us who can do more than one thing. Besides, before short sales, I sold traditional homes for decades, and I still do.
A Sacramento Business Journal article quoted me last week as saying that selling a short sale is like selling 5 homes in one. And that is true. If I can sell a short sale, by George, I can certainly sell any seller’s home with equity. A short sale is 5 times the work, and much more complicated. Selling a home with equity is an activity I can almost do blindfolded. Trained monkeys can sell a home with equity in Sacramento in a seller’s market, with buyers camping out in your yard. But an experienced Sacramento real estate agent is the person who bring you the most money and the smoothest transaction, and that’s what every seller wants.
I spotted a new home listing this morning come on the market in Carmichael. It’s a home I sold for $100,000 a year ago as a short sale. It’s also a home that took me 12 months to sell. I listed it in May of 2011 and it did not actually sell and close until May 2012. Well, it sold a bunch of times, and buyers flaked out. That helped me to get the bottom line from the bank, though, and I told every buyer who called the home could be theirs for $100,000. I had buyers who walked away completely and then came back crying, others who walked when we wouldn’t take their offer of $98,000. You ask yourself: What is wrong with people? Why do they let their egos get in the way?
I can’t count the number of offers we received that were between $90,000 and $99,000 but these guys just refused to inch over and join us at the winning $100K offer price. It wasn’t a secret. They knew they had to pay $100K, they just wouldn’t do it. They walked away due to a $2,000 or a $5,000 difference. Doh, doh, double-doh. But persistence prevailed, I don’t give up, no matter what, and it did sell at $100,000.
This particular home just came back on the market at $229,900. And you know what? That’s a good price. Those sellers will get it. I just wish I had this end of the listing, too, where the living is easy.
A Sacramento Short Sale Can Stress Even a Cat
Has your Sacramento short sale situation stressed out the cat yet? Cats are such delicate creatures. Oh, they put on a big act, like they are all tough and everything, ready to tackle any challenge or fishy treat tossed in their direction, but underneath, they are mush. They can be traumatized, and a short sale could do it to them. Cats are able to sense stuff. Don’t ask me how but cats know when you’re coming home, even if it’s not at the same time every day. If a cat was lost in Seattle, he could probably find his way back to Sacramento. A cat is capable of amazing things.
Our cat, Pica, tried to runaway from home once. He forgot to pack his catnip in a red scarf and tie it to a stick. Instead, he spied a door that was ajar and he slipped out. Pushed it open and split. Free, free at last in the back yard. He was petrified and spent the night in the bushes under our Japanese maple. Ever since then he’s been on Prozac. Only in California, I suspect, would a cat be given a prescription for Prozac. I tried to wean him off it once but he climbed up on the kitchen table and soaked the newspapers. A fine tribute to the Sacramento Bee. Tsk. He now has to take Prozac the rest of his life.
Our pharmacy called yesterday. I don’t know why since I order his Prozac online. But Walgreens called and my husband answered the phone. Our cat’s name is pronounced PIKE-ah. Like pica and points in newsprint. The Walgreen’s clerk asked: Is Peeka Weintraub home? That question was a bit confusing for a few seconds, as was the fact that our home telephone actually RANG with a caller on the other end. My husband answered, Yes, he is. The clerk asked: Can Peeka come to the phone?
Why no, he cannot. Because he is a cat.
The clerk didn’t seem to be listening. She asked again if she could talk with Peeka Weintraub, and my husband explained again that he cannot come to the phone because he is a CAT.
Well, his prescription is ready.
This is what talking to a short sale negotiator at the bank is like. My husband doesn’t have as much patience as I do. That’s why I make a great Sacramento short sale agent. I’m used to such nonsense. I’ve been selling short sales for 8 years now, and I probably sell more short sales than any other agent in the Sacramento area, from Lincoln to Galt. If you’re looking for a Sacramento short sale agent, call Elizabeth Weintraub at 916.233.6759. Your cat will be happy to release the stress.
Are Short Sales Over in Sacramento?
Are short sales over in Sacramento? I might recall the year of 2012 in years to come as a year-long Chinese celebration or maybe lost lyrics to an Al Stewart song; however, I am fairly certain that the short sale-blitz in Sacramento has pretty much gasped its last breath. I would know this because I list and sell a ton of short sales in Sacramento, among other types of homes in Sacramento. For the past 8 years, I’ve been very much focused on short sales because short sales have made up a big part of the home sales in Sacramento. It’s not like a Sacramento real estate agent who wants to do business in Sacramento can ignore 1 out of every 3 possible sales.
I think I can safely predict that when my inventory is switching to equity sales, then short sales are beginning to ease up. Most of my new listings are traditional sales for sellers with equity. In fact, very few phone calls are from sellers with a documented hardship for a short sale. Most of the people who call me about a short sale are either trying to sell a home for somebody else in the family who died and the home is underwater. Or, something just happened to create a reason to sell such as divorce, medical emergency or relocation, and the home is underwater.
Most homeowners in the Sacramento area who wanted to do a short sale have already done a short sale. Some of the homes that these sellers have closed as short sales have popped back up as a short sale for the new buyers who bought in 2008 or 2009. Yeah, there have been short sales completed on the same home twice! I’ve worked on a few short sales from sellers who bought in 2010. But that was pretty much the last defining year, and 2010 was on the edge. So, while there are still many homes (around 40%) in Sacramento underwater from the 2005-era, if those owners haven’t dumped the home by now, they probably won’t.
Throw into the mix we’re in the hottest real estate market I’ve ever seen in Sacramento. There is no way to describe the debauchery of this seller’s market. If interest rates were not so ridiculously low, the market would be different, I imagine, but cash buyers are definitely fueling the flames of the buying frenzy. I feel empathy for the buyers out there who can’t buy a home.
But I do believe the year of the short sale is over. We may find many short sales over in Sacramento. At last, the short sale train has left the station. So, don’t pay any attention to those guys in the party hats blowing streamers because they don’t have any tickets. They’re just hungover.
