Richard Moen

Dear Congressman,

I am writing this to bring some reality to all of the “good faith” rhetoric we keep being given on national news about the way banks are helping people in trouble with their home mortgages.

I am a real estate broker in Wisconsin. I and my agents have been working with REOs and short sales for a number of years. The same problems exist now as opposed to before the President put out his directive to help these home owners and until these problems get corrected the real estate market will struggle to get back on its feet.

I am only going to address the short sale process in this correspondence.

The process that actually happens is the customer contacts the mortgage holder and asks about a short sale. The customer representative generally gives some guidelines or directs the customer to a web site that gives an outline of the procedure. In that packet is an authorization form that allows us as real estate agents to discuss the matter with the short sale department.

The form is filled out, in many cases notarized and faxed to a designated fax number to get into the companies loss mitigation system.

Generally the company says to wait 5-7 days to allow processing before the agent will be granted authorization to discuss the customer’s account. The agent waits the 7 days and calls the number given. The agent is then told they do not have an authorization on file. The agent request where to fax it to. A new fax number is given. Agent faxes to the new number and waits 7 days. Calls back and again is told the company has nothing on file. A third fax is sent. After 3-4 weeks the agent may be able to discuss the account with someone.

I even had one loss mitigation rep tell me the number I faxed to was wrong , they had never heard of that number and did not think it was within their company. I asked for a different number and they gave me the one I had just given them. Then they were really confused.

So, eventually I get to talk to a rep. I have in front of me the companies outline for a short sale. I begin to ask questions and the rep tells me I am wrong on the procedure. I point out that I am reading directly from their directions posted on the website. They want to argue. (This happens to be Jamie Diamonds Chase by the way).

I give up and ask what they want me to do. I am given some instructions which I follow to the tee and when I make the follow-up call (in 7 days) I am told “who told you that?” That is not how we do it. We have instructions posted on our website. Follow them.

This same ridiculous change of events happens with nearly every lender we encounter. Chase, Aurora just to name a couple.

Then to top it all off, we are told when we get an offer that it will take 45-60 days to get approval. They also want to close soon after approval.  Who do they expect to buy these homes? Most are lower priced homes with the buyer being a first time home buyer who is scared to death to begin with. Then they are told they will pay a penalty if closing is delayed.  Are they to give notice to their landlord and hope the bank approves the sale?

So, the first time home buyer in many cases is not able to buy these homes. So who is the best buyer? The investor. They have the time to wait. But they are not willing to pay as much for these homes as a first time home buyer is. The investor wants to make a profit.

So, the home sits on the market and the values drop.

This is a dog chasing the tail syndrome that will only be corrected when the bank’s employees star to care about what they are doing, are trained to know what they should do and the bank is in position to deal with the offers in a timely manner.

I should also add that the banks want to list these homes at less than a fair commission. I am personally working with 3 currently, not because of the great money but because the owners asked for my help. The cost to work with a foreclosure or short sale is high and the return is low.

I could go on a long time with the horror stories we have encountered. We put up with the garbage because we want to help the home owner. For a bank to insist and agent give up part of their earned commission to get a sale done is extortion, but it happens a lot.

If you would like to discuss this matter further feel free to send me an email or give me a call at 920-988-0588.

Sincerely,

Rich Moen