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Dear Congressman Connie Mac,
September 5, 2009 - Scott Brenner
September 4, 2009
Congressman Connie Mac
Subject: Bank of America Accountability in Short Sales – Mortgage
Dear Congressman Connie Mac,
I am a real estate broker still working and servicing the greater Ft. Myers – Cape Coral FL area; I know you understand the hardship Lee County is going through presently in the housing market.
That the majority of real estate transactions in Lee County are distress or REO sales, in these tough times sellers are unable to sell the house for the mortgage amount owed are seeking work our solutions with mortgage originators with purchase offer known as “Short Sales”. It gets more complicated when the FDIC forces the liquidated/absorbed of one bank into another (Countrywide into Bank America).
Hard working honest sincere realtors are daily showing and obtaining Short Sales purchase contracts with a standard FARBAR “as is where as” purchase offers buyers and sellers accepted the terms of the offer. The purchase offer is predicated on the basis that agreement terms are acceptable by the seller’s lender.
This is where the system has “issues”.
Just to get the bank to acknowledge receipt of receipt of a “short sale” file can be difficult and time consuming, once they acknowledge they are in possession of the file, the lenders require current financial, hardship letter, months seller is behind in monthly payments, present financial documentation and proof by various means (copies of checking and savings account IRA basically require an accounting of all assists and liabilities). A documentation of the sellers present financial position, a normal prudent business measure.
Congress over sees AF (Appraisal Foundation), which delegate to the ASB (Appraisal Standard Board) who monitor, interpret amend and improve the Uniform Standards of Professional Appraisal Practice. Which banks agreed that these minimum performances are meeting, to document value?
In a declining market such as ours it is difficult first to find a buyer and seller, then to come to terms, then submit a complete short sale package so we can get on with the recovery process.
When banks are not responsive to accepting, processing and working towards forward progress of these short sales then the buyers become disinterested and sellers fall further behind in payments and the property values continue to erode because the banks nonperformance, neighborhood erode because of uncertainty of a out solution some property maintenance is not performed. This downward spiral effect magnifies as unemployment increases.
This is a dangerous cycle, especially in Lee County where when the power is turned off and mildew and mold can over take a property in as little as 30 to 60 days if not attended to.
These Banks are the TARP funded recipients, who claim they are over whelmed with the amount of short sale files they have to process (Maybe they could hire some of the unemployed and help get us out of this crisis). Which it is basically a three part process/system, Intake file, insure the documentation is complete and timely then turn over to the Negotiator, whose job is to either approval or make a counter offer or reject the offer if acceptable terms and conditions are met then turn over file to obtain the Investors approval or rejection.
I am asking you to look at the performance of the banks that have received TARP bailout funds, and apply similar standards of processing (time guidelines) as you presently deploy and enforce in efforts to obtain accountability & responsibility by financial institutions similar as you do with AF (Appraisal Foundation), which delegate to the ASB (Appraisal Standard Board) who monitor, interpret amend and improve the Uniform Standards of Professional Appraisal Practice. Many of the same fundamental value and time issues translate directly to the value of the property and ultimately the owner who I see may be the American Tax Payers.
Bank America/Countrywide is the largest of these institutions and they have performance issues. My office has submitted a short sale file to Countrywide in April 14, 2009 when Countrywide was taken over by Bank of America my file was “off the grid” I had to resubmit, which we did and on May 21, 2009 we received by US Postage notice of acknowledgement of receipt of the faxed file. On June 2, 2009 called for a status update asking if they required any further documentation, Bank America stated they will review and call back in week, June 11, we point out the time of acceptance issue on the pending contract, Bank America still acknowledged they have the file in the intake department and it’s under review. We prepared an addendum to the contract and extend another 30 days. June 16, Bank America Short Sale Processor acknowledges receipt of contract extension and made a request to accelerate notice to the Negotiator call back in 5 to 8 days, June 23, Bank America states by automated phone message a negotiator will assigned to the File by July 2. June 28 I personally speak with Bank of America representative Eddie extension 8728, who said file will be assigned a negotiator on July 2, check back on the 3rd and should have a negotiator assigned.
On July 3, 2009 I call have to go through several automated phone processes to get to a real person and ask to check status report and ask who the negotiator is on the file Christen the Bank America phone representative stated the file was not assigned a negotiator yet and she would submit a second request to accelerate the intake file by ordering two BPO’s (Broker Price Opinions) that I need to allow 5 to 10 business days before these BPO’s can be added to the file before they turn over to the negotiator. I point out the addendum to the contract was for 30 days and 10 business days puts this file out of contract her reply was “then save the tax payers the time and trouble if you cannot keep the purchase offer together” this brazened attitude toward lack of accountability on the behalf of banks performance is amazing.
After rewriting all required documentation for another 60 days, resubmitted to the bank I was told the file had been forwarded to the “Investor” who is Fanny Mae, and told it would take another 30 to 45 days before any response can be expected.
These banks attitude and performance is unacceptable. We bail them out, then try to help liquidate their mistakes, and do our best to be part of the solution and still they are maintaining a complete lack of responsibility to their performance. The term Casino Banking is now being termed verses traditional conservative capitalistic practices and professional capitalism. I think in many regards, the risk return and search for profits (greed) drove us to this point in the house/mortgage/unemployment issues we as a country are facing. Realistic “good” growth and returns need to be reset into the institutions, regulations and standards of practice enforced. No more foxes protecting the chickens.
It is well past the time which recovery standards and minimum time performance guide lines need to be enacted; performance and work out solutions need to be established, and be enforced so that all TARP funded banks must adhere to and be held accountable to higher standards of practice and time line minimum performance standards established so the American tax payer can reasonably expect the repayment of it loans to these TARP recover emergency bailout loans.
Presently we (US Tax payers) are victims of unregulated performance standards of banks performance on non performing loans. Until they write down the actual market value of the mortgages then the industry is at a stalemate. I realize if the banks did write down the value to real market values then the banks themselves would be insolvent, but is that not a pay me now or pay me later scenario? I really don’t want to see more banks go under, they can and should seek other remedies then foreclosure, get them to work out short sales hold them accountable to loan modifications at more realistic terms rather than force family’s into bankruptcy and foreclosure, and ultimately on the streets..
Again another expense the US tax payers but more sustainable at least we don’t create blighted neighborhoods Which compounds the problem when the banks move ahead with another foreclosure which means more time and more money spent to go through this foreclosure process clog up the court system adding additional time and legal expense when a ready willing and able - real buyer is able to take over the property and there by ultimately saving the tax payers time, money and assist in the recovery of our local neighborhood and local economy.
Lee County needs your help in resolving this very real issue. Establish time and performance levels that banks must adhere to and work with buyers and sellers of short sale properties, thereby leveling the field and have financial incentives to cooperate and exceed their projections and negative consequences to banks which do not meet these minimum performance standards and practices.
As congress did when the collapse of the saving and loans in the 80’s we need to reform and create standards of liquation and performance within these areas of banking industry today. A big Toxic assist bank does not appear to the best solution. This just creates easy way for bankers to dump their mistakes onto the American Tax payers on to huge bulk sales of assists to powerful investors who pay pennies on the dollar value and reap huge profits at the expense of the taxpayers and empowers “casino capitalism” and too big to fail big money verses the little guy class distinction.
Scott Brenner Broker/Owner Sellstate Advantage North Realty, Inc 3351 Marinatown Lane Suite 100 North Fort Myers, FL 33903
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