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We knew bidding on a short sale was going to take awhile but it is starting to feel like we will never get the home, not sure if this is a personal feeling about Flagstar or not. Since a home is quite possibly one of the largest purchases you will ever make, well it makes me pretty anxious. We finally found a home that we like, in a good school district, a nice neighborhood in a good area. But it has been sitting for over 6 months so it needs a good amount of TLC. New carpets, some wall painting, 5 door replacements, power washing, yard work. But nothing major.So we started working with our realtor to put a bid in on the home.
2011 City Property Assesment is at $350,000 – Home was listed at $315,000 – We are offering $295,000 (last sold in 2006 for $420,000)
We started the short sale process late August 2011.
August 25 – We learned that flagstar was the bank and our realtor hadnever worked with them before
Sept 8 – Ratified Contract (current home owner signed off on everything)
Sept 29 – We received news that Flagstar ordered the BPO and that we would here back in 1 week (Broker Price opinion where someone comes out and puts a vaule on the home based on ALL factors)
Oct 19 – Email from my realtor>
“I spoke to the listing agent today for an update. Apparently Flagstar must not have liked the results of the BPO and hired an appraiser as well. The listing agent met the appraiser on Wednesday, 10/12. She said she was very thorough, especially when it came to documenting the condition of the home. I have asked her to follow up again next week with the bank to make sure they have the appraisal and if there is anything else that they need to approve the sale.
The listing agent said that the bank’s primary concern was the size of the write off that they will end up taking. I asked her to remind them that the market value is what it is, and that having an offer in hand is far better for them than to incur the expenses and delay associated with going through a foreclosure.”
I will add an update as soon as I get one. My realtor recenlty told me that he had another client ratify a contract 1 week after us and he received his keys last week. That was a wells fargo short sale. Overall I don’t feel like it is taking that long, I am just anxious. I have read some horror stories online about Flagstar taking over 6 months, especially if the home is not close to foreclosure. Unfortuntely I have no idea when the home owner missed his 1st payment, but I do know the home has been on Zillow for 171 days now.
Nov 4th email from my Realtor:
“>Finally got an update from the listing agent for xxxx. The bank has
>reorganized how they are handling short sales and have dedicated more people
>towards processing short sales, and our file has been assigned to a
>negotiator. That is good. We’ve got past the paper pushers and now having
>a negotiator assigned, we should be able to get some answers.
>The seller’s have received the demand notice and have been told that it has
>been referred to an attorney for foreclosure; however, they have chosen not
>to set a date yet. What this means is that they are doing all the
>background and legal paperwork, but not taking the final step of the
>foreclosure. Banks do this so that if they cannot get a short sale closed
>they have not lost time and can foreclose quickly. Basically, the
>foreclosure is traveling on a parallel path.
>While a foreclosure referral is bad news, one of the results is that is good
>is that we have now been bumped up to the top of the stack. William, I know
>that you mentioned that you had read earlier about other short sales with
>Flagstar Bank that it took them moving to foreclosure status for the
>approval to get done. Well, it looks like we are there. Let’s keep our
>fingers crossed that this pushes the deal over the hump and not over the
>I have reiterated to the agent and asked that she remind the negotiator that
>the sunset date on our contract is November 30, and that if the deal is not
>approved by the bank by then, we have the right to walk away. Now that the
>deadline is in site ahead and the foreclosure is coming up from behind, they
>will have to make a decision. Gut feel is that we should have an answer in
>the next 2 weeks.
>At this point, I suggest that we hold tight for another few weeks.
>Hopefully, a decision will come in the next couple weeks. Legally, you
>still are obligated under the contract until the 30th. At that point in
>time, it is your OPTION to pull out without penalty. So, I would suggest
>that the plan continue to be to hold tight with the current contract and if
>we do not have approval by the last week of the month, then let’s start
>looking. By that time, xxxx will be back from Texas and we can search in
>earnest. We can keep the contract on xxxx in place until we find
>something you like. At that time, you can terminate the xxxx contract
>and get a release and move on. We cannot put a new contract in place until
>we have the old one released.
>I will continue to follow up. Hopefully, we’ll get approval in the next
>couple weeks and move on to closing.”
Nov 4th Reply from Realtor:
“We don’t know exact numbers, but the mortgage that is outstanding now was originally in the amount of $364,240 back in June of 2007. IF it was a normal, amortizing mortgage, then it would be somewhere in the range of $348,000. It shows as a conventional mortgage, so there is no way to know if it was amortizing or if it was interest-only, or even a “pay-option” arm.
Overall, the mortgage balance should not have an effect on their decision. The value is the value, regardless of what is owed.
Hope that answers your questions.”
Nov 16 Email from my Realtor:
“Here is the latest update. Hope we get a decision this week.”
From the seller’s Realtor:”Just wanted to let you know that the sellers emailed Flagstar the updated financial documentation they were requesting yesterday. I followed up with the short sale specialist also. Hopefully, we will know something soon.”
Nov 22nd Email from Realtor:
“I spoke to xxxx and got the latest update from the bank. She got an email over the weekend from the processor at the bank saying that they had not provide pay stubs for the husband and that they could not process the short sale without them. xxxx called them on Monday to remind the processor that he has been unemployed since April and that was the reason for pursuing the short sale in the first place. He saw that it was noted in the file & apologized and said the file was complete and
a decision would come shortly.
I know it is frustrating when we hear things like this, but I understand that a processor has hundreds of active files, so I’m not surprised that they forget that someone is unemployed or don’t look through the file in enough detail. Hopefully we’ll get an answer soon.
I reminded xxxx and asked that she also remind the bank that November 30 is an out date you and that if a decision has not been made by then you will likely move on to something else. I want to make sure we keep the pressure on so that they understand that they have a deadline and that deadline is a week from tomorrow.
I’ll keep calling and let you know the results.”
Flagstar Short Sale – Results <<<<<<<<<<<<<<<<<<<