In an effort to stop sellers facing foreclosure from gaming their system, Wachovia has completely stopped allowing any postponement of a foreclosure or Trustee’s Sale. I have long felt that Wachovia was not simply a good lender to deal with for a short sale – truth be told – they were the very best.
I’m being told that this new policy isn’t going to be a “bad” thing. I don’t see it that way. To penalize everyone because of the bad actions of a few is seldom good (even if common).
Here is a copy of a response from Wachovia that was sent to me via the title company:
**IF THERE IS A FORCLOSURE SALE DATE SET – WE WILL NO LONGER POSTPONE THAT DATE FOR ANY REASON – if there is an active foreclosure Sale Date we MUST RECEIVE funds no later than 5 DAYS before that Sale Date, also if there is a SALE DATE set we must receive the full package 10 business DAYS prior to that sale date (and again, we will not postpone that date)**
FOR EXAMPLE:
If you are SUBMITTING A SHORT SALE PACKAGE on a property that has a SALE DATE SET FOR AUGUST 30th, the SHORT SALE APPROVAL WILL BE ISSUED with an expiration date of AUGUST 25th and we will NOT EXTEND the Short Sale approval or SALE DATE.
Sandra Villalpando
Short Sales Manager
Wachovia, REO
I’m hoping that this new policy from Wachovia is reversed. I do understand that some lenders say they will postpone one and then go right ahead and foreclose anyway. I’ve just always expected much better from Wachovia. And rightly so!
Property Marbella
August 10, 2010 at 1:51 am
It’s time to put down the foot. Glad the someone starting do this.
Joe Loomer
August 10, 2010 at 6:22 am
Russell,
I wonder if there isn’t some wiggle room here – the phrase “IF there is a foreclosure sale date set….” leads me to believe their way out is to not set that date, but instead kick the can down the road and still give those who are actively seeking to avoid the foreclosure or consumate a short sale the time to do so.
Our area – never one to be flush with foreclosures or short sales – should be minimally impacted, and there are an admittedly small number of true short sale agents, so I’ll defer to your expertise on this. Just seem they left it a little open to me. Was the emphasis yours or did they actually put those statements in all caps?
Navy Chief, Navy Pride
Russell Shaw
August 10, 2010 at 1:20 pm
Joe,
The person who wrote the email put the letters in caps in caps – I changed nothing but some spelling errors. Plus, my transaction manager has spoken with the short sale manager here and it is confirmed – once a date is set, it is NOT going to be changed.
Joe Loomer
August 11, 2010 at 6:23 am
Thanks for clarifying Russell – amazing what people will actually send before applying the 24-hour rule….
Navy Chief, Navy Pride
Dan Connolly
August 10, 2010 at 1:57 pm
I just wonder how a bank can say that they won’t accept funds unless they come 5 days before the foreclosure sale. I thought that the borrower has the right to payoff the note or bring it current any time before foreclosure. Can they really refuse to accept a payoff 4 days before a foreclosure?
Melissa Zavala
August 11, 2010 at 10:32 pm
Russell: My local fast track representative told me that if the seller qualifies for HAFA, they will postpone the sale. Obviously, we do not have that in writing, but this is what she told me when she called me to drop the bomb just the other day.
Russell Shaw
August 12, 2010 at 1:26 am
Melissa,
All banks – if doing the HAFA program must allow, per the federal program guidelines – a minimum time frame of 120 days to sell the home (with the option of extending up to one year). So any bank on a HAFA sale would not foreclose during that time.
What has set Wachovia apart from other lenders has been their fast track process that requires no documentation other than a hardship interview and you simply had to have a fully executed contract about 5-7 days before the foreclosure date to be granted an extension. It is what made them the best in the industry. So while I can appreciate their benevolence was met with some sellers exploiting the program, it is still the pendulum swinging too far in solving the problem of abusers.
Craig
August 30, 2010 at 2:01 am
Russell,
My sister’s realtor advised her to take all of her money out of the stock market and put it into cds because of the Wachovia news…he says his “friend” at Wachovia said that this new policy will put 60,000 homes on a foreclosure fast track and it will have a great effect on the economy. Since her husband passed away 6 months ago, she just got all of his assets into her name and invested almost all of her money through Schwab. She is meeting with Schwab this coming Friday. Is there any advise you could offer? Thank you so much.