Learn how to get your Aurora/E-trade short sale approved in this Aurora/E-trade Short Sale Case Study.
Aurora/E-trade Short Sale Case Study:
Property Location: Marysville, WA - Snohomish County
1st Lender: Aurora
2nd Lender: E-trade
Hardship:
“In January of 2010 my wife lost her job and a significant portion of income, at the same time I took a 10% pay cut. Then in July of 2010 I lost my job. We were unable to get unemployment due to the fact that I am a minister and have not paid into it.
“We have been living off of savings, which we no longer have. We tried to modify the loan, but were denied due to our lack of income.
“I have medical bills now and coming as well. My wife was working 10 hours a week, but now she is no longer employed so she has no wages or current pay stubs to show.
“We have recently moved out of state for work, but I have not been paid yet so I have no pay stubs to show either.”
1st Loan Balance: $263,000
2nd Loan Balance: $12,406
Sales Price: $175,000
1st Loan Approved Net Proceeds: $150,721
2nd Loan Approved Net Proceeds: $5,000
Timeline:
On May 7, 2011, a signed offer to purchase the home for $170,000 was received. The Listing Agent forwarded the case to Seattle Short Sales, Inc., on May 9. A BPO was ordered, and the Seattle Short Sales, Inc., case manager submitted the completed file to the lenders on May 11. On May 13, the case manager ensured that the file was complete, and that it would stay complete and upto-date in order to postpone the trustee sale.
The following week, the original buyer walked away from the deal, but on May 16 a new signed offer to purchase for xxx was received. The Seattle Short Sales, Inc., case manager faxed the new offer and documentation to the lender. On May 20, the case manager contacted Aurora, the first lender, to ensure that the trustee sale (currently scheduled for May 27) was postponed, and was told that the negotiator was aware of the date and would postpone it when they reviewed the file. The case manager called the lender back daily for the following week to make sure that the sale really was postponed.
On May 24, an approval was received from the first lender, but the Seattle Short Sales, Inc., case manager had to counter back that approval, as it did not cover excise tax or any payment to the second lender. The case manager continued to check daily that the trustee sale was indeed postponed; on May 25, the lender confirmed that the file shows that a short sale is being actively negotiated and that the trustee sale had been postponed to July. The lender also indicated that, if they were to cover 3% closing costs, the purchase offer would have to be raised to $175,000.
On June 6, the second lender requested updated financial statements and a payoff statement from the first lender, which the Seattle Short Sales, Inc., case manager started to assemble from the seller and from Aurora. The following day, on June 7, Aurora, the first lender, issued their approval letter for the short sale.
On July 13, the Seattle Short Sales, Inc., case manager requested the payoff statement from Aurora for the second time. The following day, Aurora responded that they would provide the payoff statement, but it could take up to 7 days to issue.
The Seattle Short Sales, Inc., case manager, continued to negotiate with E-trade, the second lender. On June 27, E-trade indicated that they would approve the short sale, and the seller could choose between providing $3,000 acceptable net proceeds for a lien release, or$5,000 for a full settlement.
The seller chose to settle the account, and E-trade issued their approval letter for the short sale on June 29.
Result:
The sellers, a married couple with drastically reduced income due to unemployment, were able to avoid foreclosure by conducting a short sale of their home. They paid off their first mortgage with $112,000 discounted from the balance owing, and their second mortgage with a $7,000 discount. But, best of all, they were waived of ever having to pay back either deficiency balance - a total savings of $119,000.
To download a copy of the 1st short sale approval letter, click here: http://seattleshortsales.com/LiteratureRetrieve.aspx?ID=88779
To download a copy of the 2nd sale approval letter, click here: http://seattleshortsales.com/LiteratureRetrieve.aspx?ID=88780
If you are a homeowner, and would like to learn more about short selling your home, please go to: http://seattleshortsales.com/homeowners/
If you are a real estate agent, and would like to learn about our no-fee short sale service, please go to: http://seattleshortsales.com/agents/
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