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Why Did My Loan Modification Or Wellington Short Sale Get Turned Down?

 

Has your loan modification or Wellington Short Sale been turned down? Did the reason why make your eyes glaze over? Did you perhaps NOT even get a reason? Did the reason even make sense?

We know homeowners who are put on trial modifications only to get turned down on the permanent loan modification. If you are making your trial payments on time each month why would your permanent modification be turned down?

There are some reasons although they most likely won’t make you feel any better. Some of do like to know the reasons things don’t work out the way we had hoped they would. These reasons may not make you feel any better or maybe they are just excuses by your lender, however there are a few things you may not even know about your loan.

Let’s say that you make your mortgage payment to Bank of America. You can no longer handle your payments so you ask Bank Of America to modify your loan and you apply for your loan modification. You are behind in your payments. You are in fact, in foreclosure but you are still living in your home and the judge in your case has not ordered the sale of your home at auction yet. You are nervous and scared. You see your neighbors losing their homes all around you. You are hopeful because you see on the news and in the newspapers that the Federal Making Homes Affordable Program has been helping some folks keep their home and get a loan modification. Every few months you hear about another government program that supposedley will help you stay and keep your home. But each time it is like a lead balloon. Your hopes go up there only to be shot down.

You are no longer making your mortgage payment because your adjustable rate has been applied and your mortgage payment has gone from $1600 a month to $2300 per month. You just can not make these payments. You have been trying for almost 2 years now to get Bank of America to approve your loan modification. You even hired an attorney to help you with your foreclosure defense.

Bank of America turns down your loan modification request. You wonder, how did that happen? Bank of America is one of the large lenders and is participating in the government’s Federal Making Homes Affordable program, the HAFA program and other government programs. 

Then you get the news from Bank of America who tell you that the investor is the one that will not allow you to get a loan modification. What in the world is an investor doing making decisions on your loan you wonder? Well, you are not alone in your confusion. Every day we are explaining the whole mortgage note owner thing to buyers agents, real estate agents and homeowners. Every week we run across people in the real estate business who don’t know how the process works or what the ownership piece to all of this is and how it is handled.

When you make your house payments to Bank Of America this does not mean they own that note that you are paying on. They are the servicer. Other words you will hear them called are  asset management companies.

The very first thing you need to do before you ask for a loan modification is to find out who actually owns your note. You can do this by calling who you make your mortgage payments to and asking them.

Many of the servicers don’t want to give you that information so you may have to make this request in writing and send it by certified US mail. 

If Freddie Mac or Fannie Mae  own your note- you have a much better chance at getting your loan modification approved if you qualify. If it is a private group of investors, your chances go way down. Why would this happen?

One in eight homeowners’ loans were sold to investors on Wall Street. What happens is that a bunch of loans are packaged together. These are called mortgage-backed securities. They are then sold off to investors. Homeowners who have mortgage-backed securitized loan are five times more likely to be late on their house payments. Many of these borrowers were given loans they were not qualified for from the beginning. Many of the homeowners getting these loans did not read the fine print and did not realize how high their mortgage payments might go when adjusted.

The rules to allow modifications, short sales and terms of foreclosures and deficiencies are ambiguous at best. Homeowners who are told no by the investor have little recourse.

The federal Making Homes Affordable program lenders who participate in the program must modify all homeowners that qualify. The exception is when the investor has a rule that they do not allow modifications.

The Federal Housing Finance Agency reported to Congress that these securitized mortgages are a “hurdle” to the success of the Making Homes Affordable program. The treasury department has not disclosed why the modifications are denied so there are little to no facts to go on. So don’t depend on the government to help you get your modification.

Does it make any sense for the investors to say no to your loan modification? Well, Bank of America’s  response is that the investors need their money. Chase for instance has one situation where the borrowers ( the homeowners) are trying to get their loan modified but Goldman Sachs is the issuer and Deutsche Bank is the trustee. But when you go and talk to these investors and we have on several occasions when doing short sale negotiations for our sellers; the investor passes the buck back to the servicer. For instance, Deutsche Bank says that Chase Bank is solely responsible for the decision to modify a loan or not.

Investors feel that they are treated as the scapegoats. Everything can easily be blamed on them. Since you rarely get to speak to anyone at the investors’ group it is hard to tell who is telling the truth. In this particular situation Chase bank is saying that the investor is not forgiving the past due debt and that makes the payment go up on a loan modification because then Chase Bank would have to put that past due balance along with all the penalties and fees into the loan modification which then may cause the homeowner to not qualify financially for the loan modification.

Servicers have agreements, contracts that they sign with investors. These agreements contain the rules for modifications. These agreements are called Pooling and Servicing Agreements which is known as PSA’s. The PSA is most often what the servicer says is the reason for them not being able to do the loan modification or release the deficiency on a short sale.

But when you talk to other people in the management areas or to the investors they claim that there is nothing in the PSA’s that would prevent the servicer from approving loan modifications, short sales and releases. There is a new study coming out from a law school wherein they state that only 8% of these mortgage-backed securities  agreements contain any language that says the servicer is not allowed to do a loan modification for these notes. That means that about 92% of all the NO’s; could actually be YES’s. So why would that even happen?


Law suits!  They FEAR the law suits coming. 
The language in the PSA is in question here, Chase Bank or Bank of America or any other servicer and Deutsche Bank- it says that SERVICER can “waive, modify or vary any term” as long as the servicer makes a “reasonable and prudent determination” that the modification is in the investor’s best interest. Attorneys examining these agreements say there is quite a bit of room for servicers to make these decisions. But the language itself in this agreement is enough for the servicers legal counsel to be concerned with the investor suing them for not acting in the best interest of the investor. They can not, no matter how inhumane this sounds, put the homeowner ahead of the investor. This is about business and if they want business from investors they need to make sure they are looking out for the interests of the investors.

The treasury department has stated that the fear of law suits is the biggest deterrent to getting the servicers to approve loan modifications and short sales. So doing little or simply turning down the loan modifications are the answer many servicers choose. This is not personal and this is not against you, the homeowner. The position of the servicers is to watch their own backs and to protect the assets to which they have been entrusted with, your mortgage-backed security. The Treasury Department says they can relieve some of the pressure of the fear of lawsuits by standardizing requirements for loan modifications and also provide some type of calculation to figure out if the investor will make more money by the loan modification or by the foreclosure.

We need to keep in mind one big thing in all of this and that is that these investors end up being regular people because most of these mortgage-backed securities were bought by pension funds and retirement plans of folks like your grandparents, your parents, your aunts and uncles or even yourselves. You may well be one of the shareholders of the very loan you can not pay.

What Is Wellington A Short Sale?

What is a Wellington Short Sale? 

Many people are in the situation of not being able to make their mortgage payments. 

Wellington Short Sale Agents Get Another Approval Letter for Sellers!

Wellington Short Sale Agents Get Another Approved Short Sale! 

Getting your Wellington short sale to acceptance and then closing is our primary objective once we have an offer on your home or in the case of the HAFA program, an acceptance prior to an offer in some cases. 

But this does not usually come easily from most lenders. If your lender is telling you something opposite of what we are telling you- please call us to tell us. The contradictions are really out of this world sometimes. Our sellers here all kinds of lies and accusations from negotiators at the banks who are not doing their jobs so they try to throw others under the bus in order to save their own behinds. 

Nestor had to fight all morning with a negotiator who refused to give us an extension on the closing date even though it was in this negotiator’s responsibility to get it to us. When a buyer is getting an FHA loan his lender needs 45 days to close. End of story, no exceptions. Think about this; the same lender that is supposed to approve the short sale is the same lender doing the loan in this situation. So here we go again, the left hand does not know anything about the right hand!!! 

We finally got the approval letter today!!! YEAH!!!! Oh Wait.. do you remember the post we wrote a couple of years ago… Don’t do the HAPPY DANCE just yet!!!  You have to read the approval letter first!!

The approval letter did not have 45 days to close on it. Nestor was right back at the negotiator with the error and request for the revised approval letter. After some emails back and forth, we finally got her to understand that the time to close was an error on her part. She did not give us the first approval letter until 8 days after she got the approval from the investor on the file. Well 45 days minus 8 days does not equal 45 days!

She did not want to do anymore work on the file, we could sense that in her emails to Nestor. Upon closer reading of the Wellington short sale approval letter the negotiator had left out of the approval letter the deficiency waiver language of which had been previously agreed upon with a cash contribution from our seller. That was another fight. Nestor finally got the right approval letter in his hand and we are moving forward to closing another Wellington Short Sale!  

Florida Enhanced Short Sale Relocation Assistance Program Extended

Bank Of America Extends Florida Cash Incentive For Short Sales 

Bank of America has a program to help short sales move along that is being piloted here in Florida. If your loan is being serviced by Bank Of America you had until November 30th to apply for up to $20,000 cash incentive to you, the homeowner at the successful closing of a short sale on your home. The incentive program is $5000 to $20,000.

This cash incentive is based on the amount of money you owe on your mortgage and you do not have to be late on your payments in order to begin the process of seeing if you qualify for the cash incentive.

Bank of America has extended the deadline to apply for the Florida Short Sale cash incentive to December 12, 2011. So you still have another week or so to get your request into Bank Of America. Call us because we can help you get this process going for your short sale.

In order to qualify for this program you CAN NOT have an offer on your property. We initiate the short sale and make the request. You must close on your short sale by August 12, 2012. You must also be eligible for either the HAFA program or the Bank of America Proprietary program.

The eligible short sellers will also be granted deficiency waivers in this program.

The following are NOT ELIGIBLE for this program: 

  • Ginnie Mae loans, FHA loans, VA Loans and USDA loans.
  • Lot loans
  • Short sales with offers.

ONLY FLORIDA Properties are ELIGIBLE. 

Contact Nestor Gasset or Katerina Gasset at 561-753-0135 right now to get your file moving so you can see if you qualify for the short sale relocation assistance.

We Were Listing Wellington Short Sales When Countrywide Was Still In Business

We were listing Wellington short sales when Countrywide was still in business.  Nestor successfully closed his first short sale in 1995 and I did some short sales back during the 80’s recession. 

When we started blogging about short sales in 2007 very few agents knew what a short sale was or how to do one. In fact, many of the agents who are now doing short sales were saying in 2007 that they would not even touch one with a ten foot pole. Worse than that, attorneys and title companies who do closings had no clue how to close a short sale or how to properly do a preliminary HUD1 to be sent in with our short sale packages. We helped train our favorite title company in properly closing short sales and understanding exactly what the prelim HUDs need to be like. 

There were no designations for short sales, there was no CDPE or SFR or any other designations. You either knew how to do the or not. 

When 2007 came- actually it was May of 2007- right before we joined ActiveRain- the world stood still here in Florida. The Florida real estate market came to a screatching halt. The listings were not selling and buyers stopped buying. Sellers refused to believe the market crashed and buyers refused to pay the prices that properties were listed at. The air here was so thick you could cut it with a knife. Doomsday reporting by the local media did not help matters in these parts either. 

By the time the 2008 NAR and MLS dues were payable- thousands of agents in Florida left the business. Unless you had money saved up in the bank- you were not going to make it through 2007. There were the exceptions of certain areas that are immune to most market changes. 

Since Nestor and I had experience with short sales we embraced the new market because we always do well in recessions. Most of the listings back then were with Countrywide. Nestor mastered the art of making people feel good about themselves years ago and this one negotiating skill has got us to the top of the major banks and servicers to get our short sales closed. My skill in negotiating comes with my talent of empathy and being able to get two parties to see each other’s viewpoints and then compromise on a settlement. 

Nestor has a way of knowing what is coming down the pipeline in real estate and has always been right on the money when he says the market is going to do something or a well is going to dry up soon so we have to find a new niche or a new twist on the real estate business in order to stay on top. 

Six months before the real estate market here crashed he was warning us that we had to strategize about where we would be working in the real estate business. Prior to the crash we specialized in land assemblages that we would put together and present to builders and developers. We and especially Nestor was instrumental in getting some very nice townhouse and single family home development projects and plans sold to top notch large developers. 

Obviously developers put a halt on their buying and building when prices sank by nearly 50%. This is when we said we needed to find a way that we could add value and still be profitable by returning to the residential side of the real estate business. 

That is how we got started in listing Wellington short sales and helping homeowners avoid foreclosure by helping them complete a short sale. It was as Nestor calls it, ‘the wild wild west of real estate’.  From the third quarter of 2007 and all through 2008 and 2009 we listed more than 99% of the other realtors® in our markets. We listed short sales all over the state of Florida. Our title company drove down South to Miami and up as far north as Tallahassee in order to assure our short sales closed.  

There is a time and a place to make changes to your business plans. If you are too stuck in to a certain plan with no flexibility you will go down with the rest who don’t make their move when the iron is hot. It is even OK to leave the business if it is not what you are passionate about. That is more than fine. Only you and those who are affected by your decision can decide what the right path for you to take is. 

 

When Wellington Short Sales Go Wrong- Foreclosure Trashing

When Wellington Short Sales Go Wrong- Foreclosure Trashing

When Wellington short sales go wrong by either the short sale seller will not work on a resolution to their lender’s requests or demands or when the agents don’t know how to negotiate a short sale or the seller hires an attorney who either does not care about the outcome or is not experienced in successfully negotiating in Wellington Short Sales.…. the short sale can turn into a Wellington Foreclosure.

It is being reported by the Sheriff’s departments around Florida and the banks that some homeowners are taking out their frustrations with a vengeance on the properties they get foreclosed on. Some tactics include ripping out all of the copper wiring, taking out the air conditioner units and removing all the appliances including the granite counter tops.

But even worse are the incidents where the homeowners are pouring wet cement down the bathtub and toilet drains. This does not just cause harm to the house and the plumbing it also can create problems in the city sewers and water treatment plants. The Sheriff reported that some of the homes were left with Graffiti all over the walls of the homes. Now we are very happy to report this is very rare in Wellington Florida. Most of the reporting from Sheriff’s has been from the Tampa Foreclosure areas.

Sometimes the repairs needed are so extensive that the banks are just putting the houses on the market without the repairs being made. Fortunately here in Wellington Florida this is very rare. Then the banks are selling the houses for below market value which they really don’t want to do because it further depreciates the real estate values in that particular neighborhood.

The buyers are also concerned and many of these contract for purchase are falling apart as the buyer starts to wonder what else the homeowner has done to the property that no one can see or detect. Pretty scary!

But some banks are talking about doing something about this. Some banks that are doing cash for keys are actually allowing for some very generous cash settlements if the homeowner promises to take care of the property and not take the appliances, etc with them when they move out. This is a proactive solution to this problem.

Some other banks though especially in situations where the homeowner has abandoned the property have the right and are talking about exercising that right to sue the homeowner for the damages. In most loan notes there are clauses that spell out what the responsibility of each party are. In the case of the homeowner- there is a clause that states you have to keep your home in good condition, take care of it, make repairs and protect the investment.

The Sheriff says that homeowners can be arrested and charged for destruction of property, vandalism and other violations. Banks say that whatever came with the house when you bought it, must stay and in good condition. They are talking about suing the homeowners for destroying the property.

Don’t go this far. You have options to foreclosure. If you live in your home and the home is your primary residence you may qualify for the HAFA program which will help you with $3000 relocation money. You may also be qualified for up to $20,000 in incentives to move out of your property when you are doing a Wellington Short Sale.

Call us- Nestor and Katerina Gasset at 561-753-0135 for a private confidential short sale evaluation over the phone about your Wellington Short Sale. 

Wellington REO Agents- Wellington Florida Short Sales

Wellington REO Agents- Wellington Florida Short Sales 

What is the difference between a Wellington REO agent and a Wellington Florida short sale agent? The difference is in who the agent is working for. 

For an REO in Wellington, which is a Wellington Bank Owned property- the Wellington REO agent is working for the asset manager for the bank that owns the REO. REO stands for Real Estate Owned. 

A Wellington Short sale agent is working on behalf of the homeowner or investor/ short sale seller. When we work as Wellington short sale agents we want to make sure you feel comfortable working with us that we are helping you to negotiate a satisfactory outcome to your Florida short sale.  A short sale is not owned by the bank. It is owned by the person who is the homeowner or the investor who may have tenants in the property. 

Wellington REO and Short Sale Agents: Choose Your REO Agents Based on Marketing Dominance

Wellington REO and Short Sale Agents: Choose Your REO agents based on marketing dominance and knowing the market and trends. 

Wellington REO agents that understand the market and live in Wellington Florida care about their community here. We care. We know that our home value is tied to the neighborhood condition of the homes surrounding ours. This is why as Wellington REO agents we take care of our REO listings in the Wellington area. 

Before you hire a Wellington REO agent make sure they have a marketing plan in place such as the one we do. We dominate the search engines, organic search with special emphasis on Google page one placement. We will get your Wellington REO listings up on page one on Google within the first few weeks of marketing.

Of course there are a  lot of other marketing strategies we use but since 87% of all buyers start their home search on-line we focus our marketing on driving traffic to your listings via our internet marketing strategies. 

Closed- Sold- Another Short Sale – Vintage Condo in South Beach Miami!

South Beach Miami Condo Short Sale- 727 14th Place- Park Vintage Condo SOLD and CLOSED.

Original Asking Price $169,777 in September 2010

Lowered price in increments until we got to $149,000 before we got an offer.

Buyer offered $124,500 in March 2011.

Buyer seeking financing, FHA loan from Wells Fargo.

During our short sale evaluation with the seller – we recommended the HAFA program because he met the requirements for HAFA short sale.

Chase serviced the loan. Chase is very slow on HAFA deals in South Florida.

Chase countered buyer’s offer at $144,000.

Buyer accepted the counter.

Then Wells Fargo ( the lender for the new buyer) did their appraisal.

Appraisal comes back at $117,000.

We go back to Chase with new appraisal. Chase will get less than this as an REO.

Chase lowers the price to $117,000.

There were issues with FHA and the Condo Association’s Hazard Insurance policies.

We had to go back to Chase for extensions to the closing. Issues are resolved.

Closed!

Seller was approved for HAFA so he got $3000 and no deficiency. He was SO happy that he was getting the $3000 because he really did not believe that was going to happen after all the lies that were told to him by Chase during his loan modification process in 2010.

But the night before closing- the closer from Chase called us to tell us that they had $20,000 more than what they needed to net so we could give that $20,000 to our seller at closing!!!!

So our seller received $23,000! You should have heard him on the phone as we told him this awesome news!

 

How Do You Choose A Wellington Short Sale Agent?

How do you choose a Wellington Short Sale agent? If you found this post on the internet you also have found other websites about short sales on page one on your Google or Yahoo or Bing Search. 

Just because an agent is on page one on Google does not make him or her a short sale specialist or expert. You may land on a blog or website of someone who has a few articles about Wellington Short sales. But again, look closely at who is writing those articles. 

Is this person just having other agents they know from different parts of the country adding articles about short sales? This may be a signal to you that the author of the website does not know how to do short sales for sellers in the Wellington short sale market or the Palm Beach county short sale market. 

If you read carefully the articles on these sites that you may find on page one of google for Wellington Short Sale agents, you will find out how much they really know about actually negotiating a successful short sale in the state of Florida. You may read posts and articles from agents who do work with buyers on Wellington short sales but that does not mean by any stretch that this same person has any experience working with sellers on short selling their homes in the state of Florida. 

Be careful about messages to call an agent or a company that does not have testimonials from completed and successfully closed short sale listings- where they have represented the seller in the short sale transaction. Always ask for testimonials, always ask for references. Don’t take a person’s word for it that they know how to represent you in your Wellington short sale listing. 

Click on our “Testimonials ” tab right here on this Wellington Florida Short Sale website. You will be able to read many references and happy clients who we saved from foreclosure. This is what we do every day. We have helped many, many, many homeowners negotiate a short sale instead of losing their homes to foreclosure. 

Don’t take our word for it, listen and read what our Wellington short sale sellers have to say and then call us at 561-753-0135 at International Properties and Investments Inc, a Licensed Florida Real Estate Brokerage.