A short sale fairy tale ends in a nightmare

This is the story of a short sale in the Lake Norman area that didn’t go the way we all hoped.

In March 2009, a distraught salesperson called us to help her with the short sale process. Having walked this path before, we agreed to guide her. We helped her get bank approval for the short sale of the property and put it up for sale in March 2009. During this time we marketed the house and received many offers that were later withdrawn after buyers got tired of waiting.

In early October 2009, the bank asked us to do the regular Pre-HUD statement for them. They did the BPO (Broker Price Opinion) and countered it. The buyer subsequently walked away as his offer was 40,000 less than the counter. It’s the season for lowballers!

Almost immediately (end of October), we received another offer that was more in line with what the bank responded. Our hopes were skyrocketed because we were sure the bank would act quickly. We immediately and proactively created another pre-HUD for the bank and sent it out.

Now we just wait… and wait… We made a lot of calls and sent a lot of emails. We were told to add URGENT to the subject line. We try to be a nuisance to the bank!

We were still waiting… February 2010. Almost a year later. I received a call from another agent:

agent for me: “Remember that house you had listed in the Lake Norman area on ____ street?”

ME: “ I used to have listed, HUH”,

Agent for me: “Yes, I am doing a BPO and the banks have changed the locks.” “However, you can come get your safe deposit box.” “By the way, is there a major problem with this house? I can’t believe it didn’t sell for the price you listed!”

ME: “THE BANKS”

So, there you have the saga of a short sale in this market. Almost a year of waiting in the bank and for what? After going through a few of these, this is my advice.

If you are a seller. By all means, try to short sell your home because, while it hurts your credit, it’s not as bad as foreclosure. Not all banks are like this, but be prepared for a long process.

If you are a buyer. Be very patient and don’t be in a hurry to move. Also, banks don’t take every low offer just to get rid of the asset, so you have to be reasonable. If you get the house, it will still be below market value. If finding a distressed home is the only thing you’ll consider (a mistake in my opinion), then you may want to look at homes that have already been foreclosed on and relisted with an agent. These houses are priced fairly close to what the bank wants and will usually act much quicker.