Sad to say- but after years of short sales being the 'norm' in real estate sales there has been absolutely NO improvement on behalf of the lenders, servicers, MI companies, and negotiating companies process of processing and approving these deals in any kind of timely or quality manner of service. As if BofA wasn't enough of a mess with their in-house negotiators using Equator for short sales, they go and hire outside companies to 'help' them handle HAFA short sales. I have two going now that are assigned to two different companies and the process is totally different for both.. WTH?? One negotiator "OVER responded"- really! She gave LESS than 24 hours to complete her tasks- counter from the lender- buyer respond by 10AM tomorrow; buyer okays with the ammendment uploaded, you have 3 hours to get the lenders updated approval letter for higher loan amount. REALLY!! She was flexible to a point- but REALLY??!! The nice thing was the last piece of info was uploaded by us at 3:30 and we had an approval letter by 4:30; the 'not so nice thing' now is that they want ORIGINAL signed documents that have been provided twice already- by the homeowner to BofA and by us through both Equator and fax. The HAFA negotiating company says THEY need the originals in THEIR file and to send them to BofA PO Box... go figure.. Now the other company... offer in for 3 weeks, no response, notes put into Equator asking what's up, what do you need... Finally copied ALL listed as "contacts" for the file.. STILL, no response. And one lender or servicer may be good today and tomorrow... Not so Much..
And who's bright idea is it to OVER value the properties so much that they don't get sold?? Obviously it must be true that the servicers and lenders make more if they foreclose... They can take cuts off attorney fees, asset management etc. I guess it still is about the almighty buck for these big companies to squeeze every last cent of a deal and drag this mess out for years instead of just getting the deals done so we can clean the mess out and move on... And all the while they pretend they are our partners.. At least until they can lock in their monopoly on the loan market by squeezing out reputable mortgage brokers- but that's another Blog.
Deb Espinoza GRI, ABR, ePro, SFR, CNE
Stage Presence Homes
DebSDRealEstatePro@gmail.com
Debbie - I commented on a post last night about a loan servicing company here in Virginia that "promotes" loan modifications. They are also involved with Short Sales because they're representing the note holders. Without going over this agian, I'll just copy and paste my comment and maybe you can understand where the problem is.
"I know of a company headquartered here in Virginia that is just like them. I had a former employee want to get into the Loan Modification business about 2 years ago. I told them that I would only if it could help the clients not hurt them. The employee, I'll call her "Val" stated that she didn't understand the company that she worked for, at any time in the pipeline they have 10,000 loans that needed "loan modification", but that 99% of the loans didn't get approved, because they kept asking for more paperwork from the home owner. Now the home owners were behind in payments, so the company immediately took the escrow account. Then of course, they charged the home owner $1500.00 for the loan modification fee just to process the paperwork. The initial fee was $500.00, and each time they went back for more paperwork, they would charge them again. Now, we all can do the math, if there's 10,000 loans x $500.00=$5,000,000. So, you can see why they don't have to approve the loan to make money. But it even gets worse.
You are correct, they tell the home owner not to make payments so they can be "qualified" for the loan modification. But, it is verbal, and in the state of Virginia, what is black and white are the terms. Someone telling you something does not hold up in court. So, the home owner doesn't make payments, the loan modification process takes 5-6 months only to notify the home owner that they are not "qualified" for a loan modification. Ok, so they go into immediate foreclosure proceedings or offer the home owner to sign a deed-in-leu. Yes they can put the house up for short sale, but the company will not agree to any terms, but that's not in writing either. And while the home is in short sale, they are still proceeding with the foreclosure. In the end, they get the house. Oh, and any payment the home owner pays, doesn't go towards the loan amount... it is eaten up in fees. Wait, it gets worse.
Since they are a servicing center, that means they are not actually the note holder. So, they notify the note holder that the home owner is in default and the market is bad, and the company has to foreclose on the property, etc... and the note holder is lucky if they get .25 cents on the dollar of the outstanding loan amount. So, what happens is the note holder agrees to sell to the company the note, because they don't want to have to pay for foreclosure proceedings out of their pocket, because they are already taking a big loss on the defaulted loan. So, the company buys the note at .25 cents on the dollar, then sells the note on the secondary market for .45 cents on the dollar. All the while foreclosure proceedings are almost done, the home owner gets kicked out, the orginal note holder gets taken to the cleaners, and the loan serving company makes all the money....
Hope that helps clear things up, I had to figure that out for the ex-employee, and the ex-employee copied all the files of the loan company and gave them to me, so I have the proof but what am I going to do with it? "
Kenneth
Kenneth- Thanks for your input- spot on. Many people know it, it can be proven- and you asked the $1M question.. what can we do about it?? There should be something- there should be attorneys that would take this on, a parade of agents and homeowners... Apparently the fact that these huge banks and investment companies are so entrenched into government posts, lobbyists, good old boys etc. We remain "screwed".
Debbie - This is a major loan servicing company. I even have the documents from their legal staff when they changed their name because the old one was so tarnished. Telling everyone to stop using the name, the bad reputation, etc. Thing is, they know what they are doing is wrong, but no one has stepped on their toes yet and caught them.
Ahhhh.. Ocwen now Altisource :) There was a good article in the San Diego Union awhile back too