Tampa Bay Short Sales Complicated? Hardly…


Short Sales are like the title of a new film starring Meryl Streep and Alec Baldwin… “It’s Complicated”.

Today, I wish all our Short Sale listings were Wells Fargo FHA loans. Their guidelines are specific and the process is predictable.  But the one we just closed in Palm Harbor, Florida, was ridiculous – a comedy of errors that took 16 months to close.  Here’s what happened:

The FHA has always had strict rules for Short Sales, and sixteen months ago, we found that those rules were designed for normal markets.  We listed the house and let Wells Fargo know that we were attempting a Short Sale.  Almost immediately, they told us they were ordering an appraisal. By the time I got a call from the Appraiser, we had an offer for $135,000.  The appraisal came back at $124,000.  

Perfect, right? Should be a no-brainer for the bank and a slam dunk for us.

But Wells Fargo denied approval for the Short Sale and closed the file.  Why? Because the appraisal was less than 60% of the loan value.  Makes no sense, right? They were getting more than what their own Appraiser said it was worth!  It took a lot of hammering on the Wells Fargo negotiator and higher ups within the company to get them to see that there was no way they would ever get 60% of the loan value for the house, and that they should approve the Short Sale at $135,000. By the time they finally issued the approval, our buyer had walked away and home values had collapsed.

Months go by and the best offer we can get is $117,000. In March, Wells Fargo countered at $124,000. The buyer said no thanks and walked away.  Finally, we got a third offer for $124,000 from a qualified buyer. Wells Fargo told us everything was taken care of and they were just waiting for the approval letter.

A week, two weeks go by – no letter and we can’t get our negotiator to call or email us.  Turns out, the file had been transferred to a different negotiator, the first of many transfers of this file as Wells Fargo struggled to handle the influx of foreclosures.  More time passes; each negotiator asked for new paperwork or came up with some new form that had to be signed. It was so ridiculous, giving them the same paperwork over and over.  We kept escalating up the ladder at Wells Fargo.  It was only when we got to the Vice President level that the file moved forward.  But it had taken so long that the appraisal expired and had to be done again.

By the time we F-I-N-A-L-L-Y got the approval letter, financing had dried up and the buyer that qualified in April no longer qualified in September. We put the house back on the market and eventually got a cash offer for $124,000, which closed two days ago. 

By my calculations, I made less than minimum wage for all the hours I spent on this.  So why in the heck would I continue to list Short Sales?  Because it’s not possible to put a value on the feeling I get from helping a young couple put their hardship behind them and get a fresh start on a new life.


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