Post Short Sale Approval Problems
July 27th, 2010
Today, Kevin and Fred have decided to cover a subject that they have never covered previously. Furthermore, they haven't ever talk about it in one of their Crush It lessons. The subject is post short sale approval troubles. Basically, you previously have an approval from the lender and troubles crop up. How do you deal with them? What is truly happening out there?
With a transaction that closed yesterday, our escrow officer was looking to get the last HUD approval from our negotiator at Citi. It was closing today. The negotiator denied the closing HUD despite the fact that all of the terms were met. The worst part was that the negotiator was not willing to articulate in plain english to explain that the HUD had to look a precise way. It is critical to note that just because the transaction is approved, it doesn't mean it is closed.
Realize that your approval letter at most banks states that they have to approve of the final HUD. Because the approval letters don't state what they are paying and what they are not paying, you may not know if they will approve it.
We had another post approval dilemma of late, with an approval from the controller. We scheduled the closing. About a week into the closing, we got a shout from another negotiator that introduced themselves as the the new negotiator for this folder. She requested a number of documents so that she could get the folder accepted. When we told her that we previously had the folder accepted, she let us know that that approval was no longer valid because they never got the folder accepted from the investor.
This is the sort of stuff that is happening out there that you will not here in a regular short sale education seminar. The point is that there are post approval troubles and you are going to have to deal with them if you want to be victorious in this business
If you have questions, get your Short Sale questions answered by Short Sale Specialists.
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Fred Weaver is a founding co-owner of Group 46:10. He has been working in the financing/real estate business for over 7 years. Fred began his real estate career by working for a large wholesale bank as a processor and rate/lock specialist for home mortgages. After 2 years in the business, Fred transferred from the banking side of home loans to the mortgage side. While on the mortgage side of financing, Fred gained experience originating mortgages and processing files for Morgan Capital of Arizona, Inc.
Kevin is a founding co-owner of Group 46:10. He began working in the real estate business in 2007 after spending 8 years working in the finance industry for companies such as Bank One, Green Tree Financial, & GE Capital.