Bountiful Short Sales: Can banks get in trouble for taking too long to process a short sale file?

Bountiful UTAH – I received a lot of feedback from yesterday’s post.

One agent said, “You obviously don’t know what you are talking about. Bank X won’t give us a response on the file and we have been waiting 5 months for an answer.

How dare you suggest that I am incompetent because they haven’t replied?” (The bank was a large national bank whose name I changed for this post.)

Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

First off, we are not saying that all agents are incompetent. However, we do see some agents with no experience with short sales attempting to sell them.

Here is the issue. Banks do have responsibilities. In 80% of cases, the bank we negotiate with does not own the loan. That means they don’t take any of the loss from short sales that aren’t handled properly.

In order to reduce losses, the people that do own the loans have laid out specific guidelines. Those guidelines state exactly how the bank should process the short sale.

In addition, they give deadlines for how long it takes to process the file. For example, VA gives 45 days for a bank to process and approve or deny a short sale.

If the bank doesn’t meet that requirement, then they can be fined by VA or lose their Mortgage Servicing Rights. By the way, those rights are worth $1,000 to $5,000 per loan they handle.

I hold banks accountable on short sales. It is their job to handle the short sales quickly and competently.

If they don’t do their job, then we let the people that own the loan know about it. 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 utahhomesaver@gmail.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.

Thanks for reading this, dave forsberg.

dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:

Phone: (801) 651-0707. utahhomesaver@gmail.com.

Greater Salt Lake Short Sales. Real Help for those that need it most.

View My homes for sale at BuyUtahNow.com.

Bountiful Short Sales: Do Short Sales Really Take 6-8 Months?

Bountiful UTAH – I recently received a question from John. Here is John’s Question.

“I am trying to buy a short sale. I have been waiting on an answer to my offer for 6 months. The agent tells me we should have an answer any day.

But, they’ve been saying that for a long time already. What should I do? John.”

Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

John, I think you should run for the hills. We see a lot of agents quote 6-8 months for a short sale response. Those agents simply don’t know what they are talking about.

We have processed short sales with the most difficult lenders in an average of 2-3 months. The key is aggressive follow up. You have to check on the status of the file twice a week.

The reason a short sale would take 6-8 months on average is because the agent isn’t doing that. If it takes more than a week to get a response to a question or call, then we contact the CEO of the lender and the local newspapers.

It has taken a week to get a response to a simple question. We had a short sale negotiator that we had been working with on a file. We had already talked back and forth several times.

He told us that he was waiting on 1 item and then he could make a decision on the short sale. That item was going to be completed in 3-4 days.

We waited a week and then started calling him. I would call and e-mail him once each day. We still hadn’t heard from him after a week of e-mailing and leaving messages.

We think that is pathetic and incompetent. Don’t you agree? It shouldn’t take a professional more than a week to respond to a voicemail, should it?

At that point we contacted the CEO’s office. We told them that if we didn’t have a response in 24 hours, then we would contact Fannie Mae. (Fannie Mae owned the loan.)

Needless to say, he got back to us right away. 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 utahhomesaver@gmail.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.

Thanks for reading this, dave forsberg.

dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:

Phone: (801) 651-0707. utahhomesaver@gmail.com.

Greater Salt Lake Short Sales. Real Help for those that need it most.

View My homes for sale at BuyUtahNow.com.

Bountiful Short Sales: How Do I Get A Loan Mod On An FHA Loan?

Bountiful UTAH – I recently received a question from Grant. Here was his question.

"I have an FHA loan and want to get a loan modification. My bank is playing hardball and won't modify the loan at all. My friend got a loan modification and said it was pretty easy. What can I do to modify my loan?" Grant.

Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

Here is the answer. I don't know the specific rules for FHA Loan Modifications. But, I do know how to find them. Here is what I have learned about FHA Loan Modifications and FHA Short Sales.

The FHA Program takes the loss on any short sales or loan modifications. Because of that they get to make the decisions on how loan mods and short sales are implemented.

The FHA program is administered by the Federal Department of Housing and Urban Development. Most people call it "HUD." HUD has specific employeeds that administer the FHA Loan Program.

Those employees do not review loan modifications or short sales themselves. Instead, they give specific written instructions to the lenders that handle the loans.

These specific instructions are called Mortgagee Letters. If the lender wants to be reimbursed for any loss by the FHA Insurance, then they must follow the instructions.

They issue updates to their directions regularly with new Mortgagee Letters.

Here is the bottom line. Your lender has to follow those written instructions. The good news is that you and I can access and read thru these letters online.

To find out the specific rules for an FHA Loan Modification, you will have to read thru the following Mortgagee Letters. Mortgagee Letter 2009-35, Mortgagee Letter 2000-05, Mortgagee Letter 2002-17, Mortgagee Letter 2008-21, Mortgagee Letter 2010-11, and Mortgagee Letter 2009-23.

I just found some good information in Mortgagee Letter 2002-17. "At no time shall the loan be considered delinquent solely because the borrower has not paid late fees or other foreclosure costs."

I have seen lenders put a borrower into default status and charge late fees on late fees. One late fee can blossom into thousands of dollars in charges. It looks like FHA doesn't like that practice.

There are probably a total of 40-50 pages that you will need to read thru. But, because you know the rules you will have the upper hand in any negotiations with your lender.

I think that is worth spending a little extra time reading thru everything. 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 utahhomesaver@gmail.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.

Thanks for reading this, dave forsberg.

dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:

Phone: (801) 651-0707. utahhomesaver@gmail.com.

Greater Salt Lake Short Sales. Real Help for those that need it most.

View My homes for sale at BuyUtahNow.com.

Bountiful Short Sales: What Does I Mean When The Bank Says File Is Going To Investor Soon?

Bountiful UTAH – I recently received a question from Georgia E. Here was her question.

" When the bank says the file should be going to an investor soon what does that mean?" Georgia E.


Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

Here is the answer. It means that whoever ultimately owns the loan will make the decision. For example, you might be negotiating the short sale with Wells Fargo.

However Wells Fargo may not own the loan. (Around 80% of all the loans they service are owned by someone else.) Wells Fargo will take all of the short sale documentation and send it to the actual loan owner.

(The actual loan owner could be anyone from Fannie Mae, Freddie Mac, Goldman Sachs, a Pension Fund, or another Wall Street Entity.)

That loan owner will review the short sale file themselves. Then, they will either approve the short sale or deny it. If they deny it, then they will usually let you know why.

Then you can find out the reason they denied the short sale and re-apply. Often they want more money for the house, a missing document, of some other item.

It is a popular misconception that banks own all the loans they handle. Little do most people know that most loans have been sold to a third party.

Many experts agree that this was actually a good thing because it spread the losses across a lot of different people in the economy.

If all the losses has been with 3-4 large banks, then those banks would have experienced crippling losses. 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 utahhomesaver@gmail.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.

Thanks for reading this, dave forsberg.

dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:

Phone: (801) 651-0707. utahhomesaver@gmail.com.

Greater Salt Lake Short Sales. Real Help for those that need it most.

View My homes for sale at BuyUtahNow.com.

How will a Short Sale or loan modification affect my credit score?

Bountiful UTAH – How do foreclosures, loan modifications or short sales affect a credit score? Your credit score will be affected by late mortgage payments and a short sale.

However, there are 2 things that are considered horrible on your credit report. Those 2 are items are foreclosure and bankruptcy.

Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

A foreclosure or bankruptcy will almost immediately lower a credit score by around 100 to 120 points. (The number is not hard and fast – it all depends upon what the score was before the foreclosure, and other factors that the credit bureaus don’t like to share.)

The way that they write the algorithm, a foreclosure will keep on pushing your score down for the next 2 years! A foreclosure can also stay on a credit report for 7 years.

Short sales are different from a foreclosure. Short sales and loan modifications by themselves do not hurt a credit score (depending on how they are reported.) It is the missed payments that ding your credit report.

How a short sale is coded/reported to the credit reporting bureau does make a difference in the affect it has on your score. It could be reported as a charge-off, a 120 day late payment, or a settled account.

Any of these are dings on the credit report, averaging 100 points. Here is the good news. The way they do the algorithm, it will damage your score for a shorter length of time than the 2 years a foreclosure does.

How a short sale is reported to the credit bureaus is something that can be negotiated as part of the process of the sales negotiations. Good negotiators can have a positive impact here.

But, in the end, the credit score should not be the first thing to consider when facing the decision to short sale a home.

You need to look at what is best for your family financially. The credit score is secondary to that.

Get advice from a trusted source, and then make an informed decision. 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 utahhomesaver@gmail.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.

Thanks for reading this,

Dave Forsberg.

dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:

Phone: (801) 651-0707. utahhomesaver@gmail.com.

Greater Salt Lake Short Sales. Real Help for those that need it most.

View My homes for sale at BuyUtahNow.com.

How To Preserve Your Credit During A Short Sale

Bountiful UTAH – If the right decision for you and your family is to sell the house as a short sale, then the sale will have an immediate effect on your credit score.

Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

You might feel like it’s just overwhelming and demoralizing to see your credit score take any more hits!

But, here’s the silver lining: according to most experts, 78% of Americans have ERRORS on their credit score. Why is that a silver lining?

If you have negative errors on your report that get fixed, that will be a benefit to your score.

Average people can, on their own, take steps to repair and restore their credit report/ credit score after a short sale.

Here is how to avoid any double whammies during and after your short sale.

Follow these simple steps.

1. Review your credit report. I recommend the site: https://www.annualcreditreport.com/cra/index.jsp.

Do not go to any of those “free credit report” sites. After you get the report, review everything on it.

If you see anything that is negative, inaccurate, or questionable make a note of it. On your list, write down why you disagree with that item on your report.

2. Write letters to the different credit bureaus about what you are disputing on your report. There are several sample letters available online: http://www.creditinfocenter.com/forms.

Here is a simple tip: DO NOT use the online dispute forms that are on the websites of the 3 credit reporting agencies. Write your own letter and make it short, firm, and demanding of action.

3. Mail your letters to the credit bureaus through either registered or certified mail. This is what sets the clock for them to correct issues.

The law lays out a timeline that they have to follow (45 days.) And, this gives you a record of the mailing, too.

4. Keep a file of all that you have done, including dates. Then, track your results, also.

5. When you’ve gotten back responses (or if 45 days pass and you haven’t gotten responses), then it’s time to repeat some of the process again for some item or another on your report.

If you are diligent and proactive, you might just surprise yourself by the benefits you can see in on your credit report – even after your short sale! 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 utahhomesaver@gmail.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.

Thanks for reading this, dave forsberg.

dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:

Phone: (801) 651-0707. utahhomesaver@gmail.com.

Greater Salt Lake Short Sales. Real Help for those that need it most.

View My homes for sale at BuyUtahNow.com.

Bountiful Short Sales: Why Do Some People Worship Perfect Credit?

Bountiful UTAH – It always amazes me how some people will do anything to have perfect credit. They would rather go hungry than risk harming their prefect credit rating.


A good example is a guy I will call Seth. Seth has perfect credit. He has worked to keep perfect credit for the last 12 years.


Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.


Seth has a several credit cards with high balances. He ran the balances up when the economy was strong.


Today, he can barely afford to make the minimum monthly payments. However, Seth was recently turned for a car loan, despite his perfect credit. Why did that happen?


I thought that perfect credit guaranteed that you could get a loan! Well, it turns out that Seth has too much debt.


Most banks won’t lender to someone with a high Debt to Income Ratio (DTI.)They calculate that number by adding up all the bills that you pay each month.


They use these ratios to determine if you have enough money to pay them each month. Seth can barely afford to pay the minimum monthly payments on his credit card debt.


If he pays them, then he can’t afford a car payment. His family needs a car more than they need perfect credit.


In my opinion, he should stop paying the credit cards. He should use the income he does have to take care of his family.


Having a car is more important than perfect credit. If they don’t have a car, then it will disrupt his work. If that happens, then his income could drop even more.


Then he won’t be able to afford the credit card payments anyways. Besides, there are ways he can repair his credit later on, after the economy has recovered.


At least he will be able to afford living expenses in the meantime. 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 utahhomesaver@gmail.com. I will contact you for a free consultation.


When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707


Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.


Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.


Thanks for reading this, dave forsberg.


dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:


Phone: (801) 651-0707. utahhomesaver@gmail.com.


Greater Salt Lake Short Sales. Real Help for those that need it most.


View My homes for sale at BuyUtahNow.com.

Should I Continue Paying My Credit Cards During A Short Sale?

Bountiful UTAH – I recently received a question from Paul. Here is Paul's Question.


"I am selling my house as a short sale. I am behind on the mortgage payments. Do you think I should still pay my credit cards?" Paul.


Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.


Here is our answer. It all depends on what is important to you. Can you afford your mortgage payment if you stopped paying the credit cards?


If the answer is yes and you don't want to move, then I would recommend that you stop paying the credit cards. Obviously that will hurt your credit.


But, if you want to keep your home, then you will probably think it is worth it. Then again, I have seen people who would rather have the good credit.


However, if you do want to move, then it would be better to keep paying the cards and short selling the house.


Missed mortgage payments won't have to much of an impact on your credit score 12-18 months down the road, especially if you short sale.


However, a credit card that you never pay on again will stay on your credit for a longer time. The debt will show up as written off and that impacts your credit for a longer time than missed payments.


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 utahhomesaver@gmail.com. I will contact you for a free consultation.


When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (801) 651-0707


Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.


Thinking about a loan modification? Our Layton loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.


Thanks for reading this, dave forsberg.


dave is a Real Estate Agent at Prudential Utah Real Estate - Bountiful. Layton Short Sales Realtor:


Phone: (801) 651-0707. utahhomesaver@gmail.com.


Greater Salt Lake Short Sales. Real Help for those that need it most.


View My homes for sale at BuyUtahNow.com.