My short sale nightmare!

OK, my story is long and I am getting so many emails from some forums that I frequent asking me about short sales and how they work. I decided to shorten my story and put whatever advice I can on here through my experience. I am no professional. I don’t work in real estate. I am just a regular person who needed to sell or get foreclosed on and learned the hard way about a short sale. Rather than write everyone back, I am just giving a link to this blog and if there are still any questions-please message me them. I am sure I will leave something out.

On a personal note, it is sad to see so many people are even asking so much about foreclosures and short sales. It just goes to show that times are tough out there.

First off if you are facing foreclosure and reading this, I am sorry you are in the position because I know it is sooo stressful. When we knew things were getting out of hand, we tried to sell our house the normal way. We even called “our friend” the realtor who sold us the house-she said heck no because honestly the comps were low-she was not gonna make profit. There’s a friend huh? So we called around to other Realtors. None would list the house either. I tried the whole FSBO thing-listed ads and posted on Craigslist and the flyer. I went to Lowe’s and got my little signs and printed up my flyer’s…NOBODY CAME! We eventually signed up with an agent that knew about short sales but lacked professionalism once we signed up with him. It was crazy but it is over. We listed in July and closed October 1st. What a mission it was!

I can spend this whole blog bashing my agent. Actually I did earlier but erased it! He did make our process harder by not being reachable and left my husband and I to do the talking to the banks when we had no experience at this at all. I can not stress enough-make sure you have a good relationship with your Realtor especially through a short sale. It can get UGLY. It is over now but I will say, follow your gut instinct. My husband didn’t like him from the start but we were desperate and signed anyways. Live and learn.

Here are a few things I learned in the process:

If you really can’t afford your home anymore and can’t or don’t want to rent it out-do something now. More than likely, things wont get better right away. Call your lender. See if they will work with you. If not….keep reading.

Find someone who specializes in short sales. When I was looking-very few people knew about them. Now months later Realtors are advertising they are short sale specialists. Makes me want to barf!

You can try to sell on your own. It is possible and could be a great way not to pay commisions. Not being negative here but you see the news, the whole real estate industry is hurting. Realtors included. You see, it is all a game to them. Some Realtors are great but ask any of them what listings they really show their buyers. They show the ones that offer the highest commissions! So be prepared. You may have the better house than your neighbor BUT yours wont get seen if you don’t offer the moola. You need to get people to see your house.

Your house should be listed just like any other house. You shouldn’t be treated any different because you are selling as a short sale.

If you owe more than your home is worth and can’t get any offers remotely close to your loan amount-more than likely you don’t have money for Realtors fees and closing costs. The banks don’t want that house back. They will work something out with this. In my case, I was under on my loan amount. I had no money for Realtors fees, closing costs or credits for buyers for roof problems, etc. My bank paid all that at closing. I went to closing with a pen to sign-THAT WAS IT. I paid nothing but I also made nothing. I will find out how this will work with my taxes in the next few months. I even heard of some banks doing this but giving the seller an interest free loan to pay off the “forgiven” amount. They will work something out eventually. ***One thing I need to stress. The bank really doesn’t like to work on these amounts if they feel you have money or you can pay.***

Keep a log of everything. Every call-EVERYTHING. Keep on top of this process and don’t trust anyone 100%. Not your lender and not your Realtor. The bank really does want to minimize it’s loss. Your agent wants to make sure he/she makes their money out of the deal. You gotta look out for you and your family. Sounds screwed up but it is true.

My last word of advice is regarding your lender. They WILL use scare tactics and sometimes will talk to you like you are a lower form of life. In my case, I had DR DOOM as my rep. He told me in the first 5 minutes of our conversation that he is in charge and I will listen to him. I need him more than he needs me. Let’s just say-we didn’t hit it off good and it made the process even more difficult. These banks are so swamped right now with this mortgage mess. They forgot how to treat some of us that are trying here.

I get asked how it affected my credit. Well, if you stop paying your mortgage, you will be reported as late every month you don’t pay. If you keep paying your mortgage though, banks see that you are good for another payment and are hesitant to work with you on a short sale. I pulled my credit report recently and it shows “120 days late” and “account settled” PAID. Sure looks a lot better than foreclosure!

All I can say is-it is a process but when we signed-we were so happy!

Well, I tried to save my credit but by trying to keep my family in that house and off the street-I was putting stuff like mortgage payments and home repairs on our credit cards and things just got so out of hand. This just added to the debt we already had. I always thought I had the “equity” in that house to cash in if I needed to-well that didn’t happen.

So now, I am out of that house but nowhere near out of debt. I am gonna try to “negotiate” out of it as best I can. For sure though, I will be doing it on my own. Being dooped by that realtor on my house deal just eats at me. Especially knowing that I did all the work and he made moola!

Hey-thanks for reading. If you have any questions. Feel free to ask. Good luck!