Short Sale Nightmare - a Seller speaks!

5 Responses to “Short Sale Nightmare - a Seller speaks!”

1. Barb Romeo on August 5th, 2008 8:42 am

   If been hearing more and more about banks repossessing money that was taken from home equity accounts. These institutions have determined that since the money is in essence unsecured because the real estate is worth much less than the loans, it is too great a risk to leave the money out there.

2. Leif Swanson on August 5th, 2008 9:03 am

   Short sale listings are clogging the MLS system in the Phoenix area. There are over 6,100 active short sale listings right now vs. 52,500 total active listings. That’s 11.6% of listings that are short sales.

3. Phyllis Harb on August 18th, 2008 7:17 pm

   Great post!!!! In my Glendale, Calfifornia neighborhood I call this MLS Pollution. Shame on our MLS for allowing these listiings to not be RED tagged as a maybe might sell at this price.

4. Jonathan Benya on August 20th, 2008 11:52 am

   I agree with the idea of striking short sales from the MLS! You might want to adjust your short sale info though; as of December ‘07, sellers are not tax liable for deficiency amounts.

   http://www.teambenya.com/charles_county_real_estat/2007/12/worried-about-a.html

5. pc on October 29th, 2009 4:23 pm

   I am a short seller of a property in NY. This process has been a nightmare and has taken its toll. Its almost impossible to make this long story short, but I will give it a try. A few years back in 2006 we were selling our house that we currently lived in and had our eye on a house that some friends parents were selling that we wanted in another nearby town. I had given them my word that I would buy theirs hence a verbal agreement which I would end up sticking to per my values. So when we received an offer on our house that we accepted, we moved forward on the purchase of the new house. We used Chase as our lender. Although we did not close on the house that we were selling Chase came up with an interest only loan that they could approve. Essentially doing it “no doc”. The interest rates of the two loans were 7.5% and 13%. Foolishly I agreed because I would in the end use the proceeds from the sale of our old house to refinance into a more conventional loan. Everything would be hunky dory, right? Well this is where the proverbial hit the fan. The person who gave me a verbal agreement to buy our house backed out of the deal and left me with two houses. As this did not sit well with me, I still figured I would be able to sell the house in no time. This is when the market came to a complete crash. We received no further offers for the house and time kept on ticking as well as the money out of our bank accounts to keep up with the payments for both properties. This nightmare continued for 2, yes 2 years before we were finally able to unload the house for 100k less than what our cousins, who lived across the street in the same exact house, sold theirs for only 2 months previous to when we first put ours on the market. I even had to come up with money out of my pocket at closing to get rid of the house. While trying to keep up with the payments of almost 1 million dollars of mortgage debt for 2 years I had to cash in some 401k’s and bled our entire savings to stay afloat. This caused major major financial repercussions that will forever cause us pain. When the dust settled on this stage, what we were stuck with was two terrible mortgages on the one house, no money, no savings, no 401ks, nothing. I was able to do a loan mod on the primary loan and was in the process of doing so on the second loan but this loan was eventually charged off because I was told not to make the payments on that as it was in the process of being modified and that I would be brought current once the mod was completed. This came from a Chase representative. For whatever reason, Chase decided to charge it off anyway although they were in the middle of the mod approval. Well as we sit financially destroyed we continued to make our payments for the primary loan….struggling struggling and struggling to keep up with them. Not a dime to our name….living paycheck to paycheck. We were put in touch with the collection company that received our charged off second loan. I was able to come up with a settlement of 20k on a 100k loan. I had to once again cash in the new 401k that I was rebuilding and came up with 12k cash. From there I had to make $111 monthly payments for like 70 somewhat months or whatever adds up to the 8k still owed. However, after initially sending them the 12k, I had asked them to furnish me with a receipt and they (C.R.S) refused to send one to me. I kept asking and asking but they refused. I translated this as an unscrupulous act of business and wasn’t sure if I was ever going to be credited for this payment so I did not start the $111 payments (stop the bleeding so to speak) until I received a receipt. Well I was not going to win this standoff as they cancelled the agreement and requested the 92k (interest was figured into this figure minuse the 12k) in full. Well this was the straw that broke the camel’s back. I called Chase but they couldn’t care less and told me to just speak to CRS and just blew me off. They, CRS, harassed me and my neighbors for the money. Yes they started to call my neighbors. I was beside myself. I did not know what to do. We were at an impasse. So what recourse was I left with? Yes you guessed it, I had to get out all together and start over. I did not want to file for bankrupcy. So I was left with two options, foreclose or do a short sale. I chose the latter. I must say I thought perhaps doing this would alleviate a lot of financial pain that we so desperately needed. Boy was I wrong. Chase sits on their asses for months mulling over this and that. One person says this and another that. From the onslaught two weeks later they claim we faxed the papers to the wrong number and nothing has begun. We stated we were given the number by a Chase representative, and their response was that “Oh yeah, they just gave you the wrong number. That happens sometimes.” I mean are you kidding me? No one is on the same page. We started the process in August and only until today they came up with an approval, but an approval with strings attached. All said and done, I was able to get a 456k offer for my house that has outstanding loans of a tad over 500k. Chase is requesting that I still satisfy approximately 80k that they figure I will still owe after real estate and lawyer fees etc, but will release the lien now. They also want $4400 at closing to boot. I have asked my lawyer for any options, as this leaves us in the same situation. I no longer live in NY, but want to return someday. But if I do, they will come after the 80k if I end up buying a house again in that state. They cannot do this if I buy a house in another state. I love NY and want to go back one day as that is where all our family is at. My kids want to be there, and they deserve to be. I have learned a lot of lessons that should be glaring to anyone that reads this. A bird in hand is better than two in a bush comes to mind. I accept full responsibility for this disaster as I am the one that signed the papers. So I blame myself first and foremost. But all said and done, Chase should have never given me a new loan for a new house while I had an outstanding mortgage on another house all while only making 90k. Think about that, I was making payments of close to 1 million dollars on 90k yearly salary. Although as I said I accept full responsibility, there needs to be some sort of culpability on the part of Chase for even thinking of giving me a loan in the state we were in. This comes to Bush’s everyone deserves the American dream of owning a house, but in reality this caused this dream to become a nightmare for a family of 4.

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