WA – “I can’t process this short sale without the TPS form filled out with the seller’s full name”, the short sale negotiator told him. “But, based on my calculations, this short sale will help your company avoid a $17,000 loss”, he replied.
“So, you’re telling me that unless I can get you the TPG form filled out, then you will reject this short sale and subject your company to a potential $17,000 loss,?”
“Yes, you are right”, she replied. “But $17,000 is a lot of money. Don’t you agree?”, he replied back. “I don’t care about the money. The TPG form is company procedure”, she said.
The story above illustrates just how crazy short sale lender bureaucracy is today. The guy who told me that story couldn’t remember the form name.
He said it was about as dumb as the infamous “TPS Reports” from the movie Office Space. The reason is because many banks turn down short sales only to lose more money thru a foreclosure.
As an example, the house in question sold for $117,000 about 12 months ago. Today, comparable homes are selling for $90,000 (not a typo.)
In that 12 months, the home’s value dropped by $27,000. The bank’s foreclosure process was on track to foreclose on the house in 6 months. It would have taken another 3-6 months to sell the foreclosed house.
That means the value would have dropped by a minimum of three quarters of $27,000. That mean the lender would have lost $20,000 because they turned down the short sale offer.
Here is what was wrong with the TPS form. One form had “John Arthur” entered for the seller’s name. The short sale negotiator was going to reject the short sale unless his name was changed to “John W. Arthur II.”
Everyone else was ok with the existing paperwork. The title company, the buyer’s mortgage company, and everyone else.
The bottom line: A large, nationally know lender was willing to risk losing $20,000 because they needed a document to be perfect.Nobody ever asked the stockholders for their opinion.
That’s what short sale bureaucracy does. It hurts the economy. It is also why you need an experienced, competent short sale agent. You need someone who knows how to work with the bureaucracy and get things done.
Thinking about a short sale? I can help you short sale your property and never pay the bank another penny. Send me an e-mail at PhillipsRealtyLLC.com. I will contact you for a free consultation.
When we talk, I will explain how the process works in detail. If you prefer, then you can call me at 1-800-LISTING.
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Thanks for reading this,
Jonathan is a Managing Real Estate Broker at Phillips Realty LLC.
Jonathan Phillips specializes in loan modification assistance and short sales in Pierce County Washington. Pierce County Loan Modification Help, Pierce County Short Sales, Pierce County Short Sale Realtor. Short Sale Realtor. WA Short Sales. Realtor.
Copyright 2012 All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Phillips’s personal views and do not reflect the views of Phillips Realty LLC. This information on Short Sales: Walk Away or Stay? is provided as a courtesy to our viewers to help them make informed decisions.