As I have mentioned in a few past posts, there have been many changes taking place with Short Sales that have been creating quite a lot of buzz.
Today I want to share some of these new concerns specifically pertaining to dealing with servicers instead of banks, specifically Nationstar and their recent requirements for Short Sales.
We’ve noticed that a large portion of our short sales are no longer serviced by banks, but by other entities such as Ocwen, Greentree and Nationstar Mortgage. There are so many bad mortgages that these 3 companies are taking over the servicing of the loans.
The main reason for concern is that these servicers are not banks and this means they do not fall under the control of the OCC (Office of the Comptroller of the Currency) and the Federal Reserve, which gives them the ability to create their own rules.
Nationstar Mortgage has also been the talk of our office as they have recently changed some of their requirements which are causing a stir in the processing of short sales. Here are the most recent changes and requirements:
Buyers of Short Sales who need financing must pre-qualify through Nationstar
If they use Nationstar financing they will allow the short seller to pay 3% in closing costs for the buyer. If they don’t use Nationstar there will be no closing costs assistance.
Recently, we discovered that Listing Agents have to send in a full blown BPO and a complete title search as part of the short sale initiation process.
As we all know, title searches cost money and they expect the agent or seller to pay for this even though there may not even be a contract on the property or ever a guaranteed closing.
Auction.com sound familiar?
For those of you who have not heard the news, Nationstar is requiring some of their Short Sellers to use Auction.com.
We are being told that even though you may have a legal, binding contract on the property, Nationstar is requiring the seller to put the home on auction.com for 2 weeks before they will consider a short sale.
If the seller does not comply, we are told his only option is foreclosure. We have been told that if there is an offer for less than the current contract amount, the current buyer is still in the winner’s position.
BUT if a new buyer offers MORE than the current contract amount, that offer will supersede. The current buyer can certainly join in on the auction as well to ensure they are the highest offer.
If you have a loan being handled by one of these servicers and are considering doing a short sale we can help. Call us with any questions at 239-985-4142.