San Jose Short Sale Agent: Silicon Valley Foreclosure Prevention Specialists

I get testimonials from my clients here and there.  But this one touched me, because we did have to go through a lot with Bank of America and for a very long time, but in the end it came out all right.  I was very happy that she and her family could go on without having to look over their shoulders and just go on with their lives since they had moved.  Truly, this is what I mean by trying to help the foreclosure crisis, one family at a time.  Helping people like Becky makes me feel like I am contributing in my own way.

I had a listing where a friend referred a friend whose family was going through financial difficulty and could not pay their mortgage.   As a San Jose Short Sale agent, I agreed to work on their short sale in an effort at least to prevent the non-payment and the probable foreclosure from greatly affecting their family business.  I explained exactly what I would do and how we would go about getting a good offer so as to slow down the foreclosure process and negotiate with the lenders for a mutually beneficial sale.  They were genuinely thankful and wanted to do everything they could to help me achieve our mutual goal.

Two weeks later, I get a call from the father saying they wanted to cancel the listing because they wanted to try a loan modification.  I had seen all of their financial statements, no lending institution was going to cut their interest rate or forgive portions of their principal – which was what he says he was trying to get.  I didn’t want to be the one to splash cold water in his face; so I said I would withdraw the listing while he tried to get a loan modification.

Three weeks later, I get another call from the father.  He wanted me to cancel the listing rather than withdraw the property from the market.  Why I asked?  He said that the loan modification person told him that in order for them to take on the loan modification project, they needed to sign a listing agreement.  I was supposedly preventing him from getting a loan modification……   What could I say to that?   He sounded so convinced that he would get a loan modification, I didn’t have the heart to tell him with their decrease in income, they were not going to get anything meaningful modified.

I knew a legitimate loan modification organization had no reason to sign a listing agreement.  Why would they?  All they were trying to do was get the loan re-worked; they had no need to list the house for sale for that purpose.  I knew something was not right; but this was a friend of a friend, I didn’t want to appear to be standing in his way of getting at that loan modification in the sky.

Two weeks later, I check and the house is listed as a short sale with a Realtor and not some loan modification company.  I sensed something was not right, but I wasn’t going to go back and demand an explanation.  I just wrote it off as someone who must have found someone they felt would do a better job at saving them from foreclosure and moved on.

A few days ago, six months after I canceled their listing, I got a frantic call from the father again.  He wanted to know if I could help him.  According to the MLS, the house was supposed to close escrow in early October, but he was advised by the agent that the buyer had backed out and the Realtor wanted him to write a check for one month of mortgage payment after six months of non-payment to stop the foreclosure (What?!). Apparently he was told three buyers had backed out over the months.  He graciously offered to give me the listing if I wanted it……..

I thanked him but declined.  I advised him that the listing agreement was active for two more weeks and I could not take the listing even if I wanted it.  So I started asking questions to see why the nice house in a good neighborhood had fallen out of contract on three separate occasions.

It turned out that the only reason why the father had me cancel my listing and went with another Realtor was because the other Realtor had offered to kick him back $5,000 after close of escrow! I do a lot of short sales, I understand the need for money and how enticing that could be for a family in financial distress.  So right off the bat, I don’t blame him for being enticed and going against the recommendation of the friend who introduced me and my explanation of why I was best equipped to help with their short sale; he saw an opportunity to make free money.

What I was able to find out was: he knew absolutely nothing of what was going on with his short sale which progressed for the past six months and went through three offers. He never saw any paperwork, not even a copy of his own listing agreement, so he didn’t know when his listing agreement expired.  He never saw any communication with the lending institutions, never saw the notice of default, the notice of trustee’s sale…..nothing.  He was lulled into oblivion with the promise of free money. Yet, the Realtor had persuaded him to move out to an apartment because the buyer was going to close escrow.

I specifically asked him to go and get copies of the listing agreement, notice of default, notice of trust deed sale, and any other written communication from the lending institution explaining the status of his short sale, as he knew nothing except an offer had backed out and he was not going to get his $5,000.

We spoke again today.  The realtor did not give him any of the documentation and had told him that the house went through an auction and is now an REO property.  So why ask for one month’s worth of mortgage payment to stop the foreclosure on an REO property? They now have a foreclosure on their record, so my initial effort in trying to minimize the effect on their family business by avoiding a foreclosure on their record was thrown to the wind for the promise of free money which never materialized.  He now wants to sue the Realtor……

So what did this family gain by going with a Realtor they did not really know but who promised them free money?  They lost their family home; have a foreclosure on their record; live in an apartment and paid rent when they did not have to; all the family members probably went through an emotional roller coaster ride which could have been avoided; and now needs to spend money they do not have to sue this Realtor.  Did this family’s fate have to end this way?  Was one bad decision the result of these compounding negative effects?

What is the moral of this story?  I believe it is that short sighted greed should not be the driving force behind your long-term decisions.

What do you think is the moral to this story?