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August 16th, 2010 9:50 AM by David W. Welch
I think the banks have been listening to too much Rolling Stones. "Time is on my side." Unfortunately, time is not on their side when it comes to approving short sales. Here is a simple rule for all the big banks out there. The longer it takes you to approve a short sale, the more likely you are to lose the buyer. If that does not make an impact; the longer it takes you to approve a short sale, the more likely sellers are to take advantage of living in the house for free. I recently had a Bank of America short sale that I worked on for two and a half years, before they finally made a very dumb decision by not issuing an acceptable approval. This kind of complete incompetence on their part has earned them the reputation for being the worst bank in America to deal with on a short sale.
If they were not going to issue an approval without reserving the right to pursue a deficiency judgment for the entire amount of the shortfall, they could have let us know that 2 1/2 years ago. The seller would not have wasted her time, I would not have wasted mine and the buyers and their agents would have save themselves the trouble. Bank of America could have taken the house back while it was still worth $100,000. Instead, they are going to be getting a house that has not had the utilities on for almost three years, and is only worth about $55,000 in its current condition. Brilliant decision making if you ask me. This is likely to force the seller into filing bankruptcy, so Bank of America has no deficiency to pursue and they have a house worth far less. Add to that the additional attorneys fees, and sales expenses to sell the home along with some upkeep and maintenance and you can see that time really is not on their side.
David Welch Real Estate Optimist, Orlando Real Estate