http://www.hermannlondon.com

You asked the following…

>>>Why don’t lenders pre-negotiate their short sales so they never have to go to foreclosure in the first place? Why not set a price prior to or just after a listing is taken? Why not set out clearly defined requirements for all?<<<

I believe the answers to your logical and practical questions lies with the current owner of the loan which has most likely been sold into a pool of loans as a Mortgaged Backed Security. The covenants and restrictions of the Mortgaged Backed Security restrict or prevent the servicer of the loan from pre-negotiating any set amount or percentage of loss the owner of the note is willing to take.

Your solution of a pre-negotiated price strategy and short sale protocol would most likely have to be agreed to by every investor of the Mortgage Backed Security. And there may be hundreds or thousands of investors to any particular Mortgage Backed Security. So getting hundreds of Institutions, Pension Funds and Hedge Funds to agree to any change in how they handle loss mitigation and short sales is DAUNTING…

Even Portfolio lenders that don’t sell their loans are reluctant to any pre-negotiated terms. But you at least have a chance in negotiating with a single owner of the note.

Unfortunately until Banks and Institutions listen to the practical suggestions of outstanding agents like yourself we will be hobbled with the status quo protocol of loss mitigation departments that inhibit rather than enable the closing of short sales.

Keep up the good work

Regards

Billy Taylor

When you have a listing that will go “short” with a bona fide offer, have a lender call the lender to help you negotiate the transaction; we speak the same language as they do.