Do you mess up if you lose your temper? ASC closed the file, again!

Foreclosures, Short Sales, Tax Foreclosures
1

I’ve been working on a SS since June 2008. ASC has, over the course of these 14 months, assigned 5 different L/M’s. Recently, they said the file was complete, on August 10th, and that the L/M had requested an interior BPO. The BPO agent called me at 9:30AM, on a Sunday! I decided to not lose my cool, because as we all know, the interior BPO is perhaps the most critical step in the process.

So, I met with the BPO agent to let them in. I have reason to believe the BPO agent completed the report by the Monday deadline and the file should then have been complete.

The problem arose when I called in today, they closed the file once again for about the 5th time! So, I practiced a little controlled anger and said, “I need this called escalated! I can’t believe you guys closed this file again! This is ridiculous. You’re wasting my time! Etc.”

I was practicing what I think of as controlled anger, though some might think I lost my temper. Fortunately, the mission was accomplished – they reopened the file, and now I’m supposed to call back again in 2-3 days.

When do I say, “Okay. I’m done. I’ve been trying to help this fellow for 14 months, but it’s over. I’m not interested in buying this property any longer. Just go ahead and foreclose and take your chances as an REO”. Seems crazy to walk away after having invested probably 130 hours into this, but why are they not taking this seriously?

2

14 months you kidding me I would have told them to screw off after 3 months. It sounds like they aren’t even interested so I would just let them have it. Let them have a NPA on their books they will regret it later.

3

Well, yes. The taxes and HOA on this one are in excess of $500/mo. I’m tempted to tell my borrower to quit paying the HOA dues, yet I imagine those dues become a personal judgment, and the bank doesn’t worry about these minor issues.

I’m still looking for the magic formula to get them off the dime; maybe calling every day would help? I usually ask when I should call back again, but I may be pussy-footing around a whole lot more than I should be.

When I have an offer in hand, I’ll turn up the burner. So far, we’re just wishin’ and hopin’.

4

Hi,

If you don't get an answer from the lenders within 45 to 60 days walk!

You should be on the phone every day 6 days a week if the lenders office is open to convey your serious about the property, need a quick approval and are prepared for a quick timely closing.

I think this is the “Number 1” reason only 20 to 25% of all short sales presented to a bank or lender are approved! Investors seem to think all I have to do is present them and they will be magically approved, well the truth is that almost 80% are not approved and the reason is the investor does not keep enough pressure on the lender, convey thier seriousness and convey the ability to close quickly.

I stopped doing short sales in early 2008 as I had 3 going, but I was spending all day every day on the phone between the 1st and 2nd deed holders and it was taking all my time for a property losing $10k a month in value.

Of those 3 I was able to get 2 approved by both lenders in less than 40 days so I was batting a 660 average, but it takes being on the phone and really pushing to make it work.

I will walk out of any short sale if all lenders have not agreed in 60 days, it’s just not worth the effort and quite frankly I am in it to make money. I am not a non-profit charity and can’t act that way reguardless of my feeling’s for the home owner.

You have to stay on the phone daily checking in and speaking to the various departments if you want to play the game and win!

You can not just present a “Hard Ship Package” and expect a approval if you don’t keep the pressure on and convey “There in Trouble”, “I want the Property”, and “I can perform and close quickly”.

I would walk if I were you and stop the loss as I feel your wasting time!

Good luck,

           GR
5

Gold River,

2 issues here:

First, the 14 months. The loan note is owned by the secondary market investor (SMI), but the servicing lender, under a written servicing agreement, has the legal right to process all short sales.

Servicing lenders do not like short sales, as they make more money through foreclosure since the new administration has come to such great power. However, they are required by law and contract to process them.

So, if they can find any reason to tank your proposal, they will do it. We have developed a very careful strategy to make it happen and it works for us and for the agents and investors who work with us.

So, something you have done likely caused them to tank it. However, oh, a big HOWEVER, servicing lender negotiators are low paid processing clerks and often come from collections departments. There is a big turnover, and a very big rate of misbehavior. Since they are overwhelmed, dishonest employees will find ways to manipulate the case to ignore a number of their files and hide them from their supervisors.

Ok, now issue 2: Since the lenders will so easily find ways to tank your case, getting each employee to laugh and have a good time with on the phone is the cheapest and easiest way to get them to go out of their way to get it processed. Recently, I had a negotiator put me on hold while he hand carried my file to another building to get a problem resolved and the approval was obtained from the SMI in just a few days. I describe this in great detail how to negotiate and handle these people in my book.

I hope this is helpful to you.

Ken Lawson, JD

6

Hi,

Hi Ken, I think you missunderstood, I don't care who the lender is and I don't care who the servicer is, if I can not get the lenders concensus to approve a short sale whether it is a first only or a first and second I walk.

This is a business, first and foremost and in the US today there are hundreds and hundreds of thousands of foreclosures, I have been doing short sales off and on for 30 years, I am just as professional as the next guy but I have no love for a piece of property, it is a way to a means and I just don’t care.

If this investor wants to keep putting time into it I don’t care but you won’t find me as a professional experienced investor spend more than 60 days.

And in spite of the National Short Sale statistics which indicate only about 20 to 25% are successful I usually bat in the 500 to 700 range, and I am not the investor who asked for help in this forum so please refrain from analyzing my investments as I am very successful and have no problem making money in real estate.

Ken, I get the same cooperation from anyone I speak with and can inspire employees to buy me a plane ticket, get me a hotel room and buy me a steak dinner and approve not only my deal but 4 other properties I did not even know about are owned by me by the time I am done.

I am so good at negotiating I can convince a white glove company to buy catchup popsicles from me at 10 times the retail price!

And I have no interest in buying your book or seeking your services so please answer the original poster or stay out of it.

             GR
7

Now Gold River and Ken - temper, temper…

I’m just seeking some help here because, unlike GR, I’m not someone with 30 years of success and chutzpah to back up my deals. In fact, the only way I can make my deals work is arbitrage. It won’t always be that way, or so I hope, but for the present, if I don’t have B-C lined up, A-B is pretty iffy. I don’t feel like I can negotiate with authority, which certainly puts me at a disadvantage.

So, this puts me down a peg, a rung, or maybe even a whole ladder from some of the seasoned pros with the CIF. But I make up for it with tenacity!

As for Ken’s book, I’m working only about files at the moment. I’d like to step that number up to about 20. Will your book give me some details on how I can do that? I’m without any staff but it’s starting to seem impossible for me to work that many files while working as an agent – listing, selling, closing – these are all taking an inordinate amount of time now-a-days. Loan originators are so slow in closing NEW loans, and because of all of the foreclosures they think closing dates are caste in sand instead of stone.

One of the things I’m finding VERY important is to have a sheet to record, 1) date of contact, 2) who I spoke with, and 3) the results of that conversation. Then when the folks on the other end lose something, I can help them out by telling them who said what and when. But I think I need to get a LOT more deals in the works, so I’m not so emotionally involved with trying to help the client avoid the foreclosure. I need to be involved because I want to help yours truly pull in some bread!

RE: Ken’s statement: “Servicing lenders do not like short sales, as they make more money through foreclosure since the new administration has come to such great power”.

I’m curious about this statement. You sure 'bout that? Could you back that up with some facts? If you’re referring to the Obama Administration’s efforts that created the “Fannie Mae HomeSaver Forebearance™” Program, I don’t see how, if lenders can make more money through foreclosure, they would be interested in promoting this forebearance agreement. Why wouldn’t they just go for the Foreclosure, if they can make mo money.

Anyhow, what do I need to do to get your book?