When were banks rushing to approve short sales?
Regardless people are trying to buy houses and can’t. It’s as simple as that.
IIUC we should not forget that one of the roots of the housing crisis was that not only the credit default swaps, loans were also bundled and traded with abandon, meaning that when the music for that musical chairs game ended (pop went the bubble) it was and is still a mess to figure out who the ultimate owner or lenders are in several cases.
And it is in that environment that many underwater home owners and lenders are trying to make a short sale work.
When I was recently looking for a home articles and people that I consulted reported that banks are not just dragging their feet just to be mean (although I would suspect that they are expecting a better deal later as the economy goes up, though slow) but because it happens that there can be **many **lenders involved, and by the rules all those lenders have to approve the sort sale…
Meaning that it can take years to finalize a short sale, I decided not to wait for it and did go for a fixer upper that was already owned by just one institution. Even then the closing was delayed by months because of inspections done late by the lender and weird red tape. I’m sorry for your situation, I can only say that I think that for me it was a good decision not to go for the short sales.
OK, I’m losing sympathy now. They were rushing to approve loans. I can’t get too upset that they’re now taking a more conservative approach.
Maybe the banks should put the brakes on any more foreclosures and focus on figuring out who actually owns what loans and who owes what to whom.
If it’s so tangled that it takes months to sort out all the ultimate paper holders in a short sell, when records are computerized and should be able to be found with relative ease, then it seems to me that many of these homeowners who can’t get loan modifications and end up walking away and short selling or losing to foreclosure despite their best efforts are probably not even getting screwed by the right people.
That’s exactly what’s been happening lately with the robo-signing scandals. The banks are focusing on cleaning up the paper trails. But you’re right in general - they aren’t going to make any more out of a house with a foreclosure than short sale, and likely even less, so their approvals of offers in the ballpark should be pretty much automatic. Bargaining over a few grand either way has to be balanced against the time cost of the money they’re losing.
John, petulant as ever, I see. And as proudly uninformed, too. Pity.
OP, I sympathize with your frustration, but the blame should rest squarely on those responsible for the housing crisis: John Mace and ElvisL1ves.
You’ll probably need to rent for a bit while you wait to close. It’s not perfect, but it’s hardly uncommon.
Cubsfan + Florida + inability to close = grief
It is an old story by now.
A fellow North Side sufferer
You are making no sense. What does their previous history of rushing to approve loans have to do with their current inability to act on any of their rotting short sale properties? I didn’t say they are making poor decisions, I’m saying they aren’t making ANY decisions and it’s costing people money and impacting the housing recovery.
I’m not asking them to loan me anything. All they have to do is say yes or no and if they can be as conservative as they want and say no to any offer that isn’t perfect to them, but at least they would FUCKING ANSWER so people could move on to the next house on the list.
This is all totally new to me. Had to sell short a couple years ago due to a divorce. Took a while for a legitimate buyer to show but once he did closing happened in a month.
Recently involved in buying/selling a house with my girlfriend. Took a year for someone to put a legitimate bid on her house. Once one was set she went out and found a house she wanted. Owing in a month and a half.
Was your show sale pre approved by the bank?
There’s no way anyone is closing on a new short sell in a month right now, at least not in the Space Coast area of Florida.
I’ve discussed elsewhere on this MB that a large percentage of short sales these days involve some sort of fraud, generally involving an artificially low selling price and money changing hands under the table, or the buyer fronting for the seller.
I would guess that’s not all of it, but this could be part of the banks’ delays.
Are any of the short sales involving homeowers still paying the mortgage? The bank has no reason to hurry if they’re still getting paid and they’ll take a loss as soon as the house is sold.
No.
Generally, the first thing shrewd short seller do is to stop paying the mortgage. They figure their credit is shot anyway.
One of my hobbies is concocting conspiracy theories. So suppose there’s a businessman in China who bought up a bunch of CDOs. They’re probably worthless, but that doesn’t worry him because the Americans who were selling them were panicked, so they were dirt cheap. The only thing that worries him is that his electronics assembly plant will suffer if the price of copper gets much higher. So he eats the loss on the CDOs in order to make sure that the houses remain foreclosed and vacant for as long as possible, thus pumping tons upon tons of scrap copper into the market, preventing demand from outstripping supply by too much.
How’s that? Crichtonian? Grishamy? Stoneworthy?
We bought two summers ago on a short timeframe. We simply rejected any home (didn’t even look st them) any house in a short sale or foreclosure. We likely could have gotten a better deal had we had time, but we didn’t. Sales when the owner is involved still go as fast as they used to.
Apropos to absolutely nothing, I’ve always read your username as “Foghorn-Leghorn.” My brain just fails when trying to actually parse it, and, apparently, that is what gets returned by the meat computer.
If you offer what is owed on the mortgage or a little more, does that help the bank to respond? The banks might be looking at all of these short sales as investment properties and are planning on holding on to the ones they can’t see for what is owed?
I know zero about this issue, can you tell?
Stone-cutter-worthy, maybe.