Just closed on a short-sale on this past tuesday November 19th. 

As I continue to negotiate and work with banks on these there are always lessons to be learned.  Here is a quick chronology from the last deal.

• August 20, 2007 - fielded a call from a seller that was nearing foreclosure with expected foreclosure date for the first Tuesday in October 2007
• August 31, 2007 - wrote up purchase sale agreement for property
• September 10, 2007 - gathered all required documentation from seller for short-sale submittal to bank.  Included in this was hardship statement, bank statements,  authorization to release, purchase sale agreement, financial statement / condition of seller, tax return of seller.
• September 15, 2007 - talked with loss mitigation department representative regarding short-sale offer.  They inquired about missing documents and missing documents were faxed over.
• September 17, 2007 - loss mitigation department sends me over to negotiator for bank
• September 30, 2007 - still in negotiations with bank negotiator and he says that he "might" stop the foreclosure
• October 3, 2007 - bank negotiator stops the foreclosure on the day of the foreclosure (...whoa that was close)
• October 15, 2007 - bank negotiator starts calling me repeatedly (that's a change) telling me he will now accept my offer.
• November 1, 2007 - receive formal written offer from bank that says they are in agreement with my discounted payoff
• November 19, 2007 - property is bought

Moral of this - PERSISTENCE...!!! I made it look easy above.  Total calls made to bank were probably over 100 with over 20 hours on the phone in either waiting or talks.

Let me know if you have any good short sales in process

Douglas' post is getting a bit stale, so let me update this with some of the key take-away points I got out of a conference call on the short sales process yesterday, June 19th 2009, that our RE office had with top decision makers at Wells Fargo and Bank of America.

-Defaults on home mortgages continue to rise and REO (bank owned) sales currently already make up 37% of sales transactions at the national level. Short sales are at 19% and projected to rise fast.
-Banks are starting to recognize that a short sale can be the honorable way out of a bad situation. Previously many would hold out and ride the foreclosure process all the way, but they increasingly realize that a short sale can net them their money in the short term at as much of a 20% premium.
-Homeowners are beginning to realize that they need to work with their lender instead of avoiding them. Options range from loan modification to short sale to the foreclosure.
-The realtor is perfectly positioned in this process as an advisor to the homeowner as the banks also have their ranks of experts.


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