Learn how to get your Metlife short sale approved in this Metlife Short Sale Case Study.
Metlife Short Sale Case Study:
Property Location: Mountlake Terrace, WA - Snohomish County
1st Lender: Metlife
Hardship:
“Due to the ongoing damages and repairs done to our home, in addition to the change in our financial situations as owners of this home, we are requesting that you approve our plea for a short sale. We are finding it difficult to make the mortgage payment, and soon it will not be possible.
“As co-owners, we have replaced a broken water main, a leaking rook, torn down the old chimney, which created water damage, and are currently in the process of rectifying a black mold issue that was discovered in our kitchen. As of now, we re unaware of the extent of the mold issue. If the problem extends beyond the kitchen, we are not sure, financially, how this will be repaired. As time goes on, it is getting more difficult to keep up with these repairs and the mortgage payment.
“In addition, one of us was laid off one month after we bought the house, was unable to find work for a while, and had to take a pay cut to return to work. As a result of this, her savings and reserves are gone, which has resulted in a large accrual of debt that she is no longer able to pay. The other one of us is engaged and wishing to move out of the area, but we cannot sell the house because it is not worth what we owe. Given that the house is older, and susceptible to water issues, we are afraid of what the future holds in terms of damage, and even more afraid of how we will be able to come up with money to make repairs.
“We have been responsible homeowners. We have struggled greatly to make our payments, but we have always made them. We have made many improvements to the home and take pride in ownership, but the house has just become too much for us.
“Based on the current market, we owe much more than what the house is worth today. Renting the house out and supplementing the difference is not an option, as neither of us has any extra income. We are already relying upon credit to live, and in a debt consolidation program.”
1st Loan Balance: $314,715
1st Loan Arrears: $9,500
Sales Price: $215,000
Approved Commissions: 6%
1st Loan Approved Net Proceeds: $191,275
Timeline:
The short sale package was submitted on May 19, 2010, and a BPO (Broker’s Price Opinion) was completed on June 2. The negotiator submitted the proposal to the private mortgage insurance company (PMI), who would have to approve the deal, and on June 30 indicated that they had everything required in their file. On July 22, the servicer’s negotiator indicated that the file was approved and that it would be sent on to the investor. On August 5, the lender indicated that the homeowners had to compile and provide detailed information in order to gain approval by the PMI, which they did. On the following day the Purchase and Sale agreement was amended to extend the lender approval deadline.
On August 12, the buyers walked away from the deal. The home was relisted, and on August 17, two new purchase offers were received, so Seattle Short Sales, Inc., continued working with the lender on the file. A new offer for $215,000 was accepted, and on August 25 the new information was forwarded to the PMI. While waiting for approval from the PMI, the homeowners were requested to submit updated financial information.
On October 14, all parties were still waiting on approval from the PMI (through the lender), so Seattle Short Sales, Inc. finally contacted the PMI directly (never having heard directly from the lender’s assigned negotiator). The PMI indicated that they had no record of receiving the file from the lender, so Seattle Short Sales, Inc., arranged to have all of the documents submitted directly to the PMI, bypassing the lender. The lender assigned a new negotiator to the file.
On October 19, a new BPO was completed. On November 3, the lender’s negotiator contacted Seattle Short Sales, Inc., to say that her manager would be handling the file as she was going on leave. The new buyers expressed their dissatisfaction with how slowly the deal was progressing, and Seattle Short Sales, Inc. assured them that, although this lender is slow to work with, the case was progressing.
On November 10, the negotiator returned from leave, indicating that the file was likely to be approved and that she needed updated financial documents from the sellers. Two days later, the lender issued an approval letter, but it was not clear whether or not the deficiency balance would be waived, so Seattle Short Sales, Inc., contact them to clarify; the deficiency balance was indeed waived.
Result:
The homeowners were able to conduct a short sale of the home that they no longer could afford, and that was worth $100,000 less than what they owed on their mortgage. They paid off that mortgage with $132,000 discounted from the total owed, and were cleared of any obligation to ever have to pay back this deficiency. They avoided foreclosure, and were able to get a clean start on the new directions their lives were taking them.
To download a copy of the short sale approval letter, click here: http://seattleshortsales.com/LiteratureRetrieve.aspx?ID=76316
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/
Comments
Post has no comments.