Short Sale Policy at Wells Fargo
The email that I have shared below was in my inbox last week. I actually received it a few times from Wells Fargo negotiators who are working short sales with me. There new policy is described. Check out the email and then my comments below it:
The email about the Wells Fargo Short Sale Policy:
If you are receiving this email, I currently am working on your short sale file or have worked on your file in the past few months. PLEASE READ THIS WHOLE EMAIL AND FORWARD TO ANY PARTIES WHO MAY BE WORKING ON A SHORT SALE FOR WELLS FARGO.
Due to recent industry changes, we at Wells Fargo will no longer be granting any extensions for short sale close dates or postponing foreclosure/trustee sale dates. If you were issued an extension letter dated 9/14 or earlier, those extension letters will be honored, but no further extensions will be granted. Files must close by expiration date on the original approval letter or they will be removed. If your approval expires 9/15 or 9/16, you will have 48 hours to get me the final HUD for approval and close.
Please let me know if you have any questions! Thank you!
The part of this letter that struck me were the words ‘recent industry changes’. At the beginning of the year, I reported on the fact that the news media reported that Fannie Mae was making it a policy to prohibit the postponement of Trustee’s Sales. However, I really didn’t see that trickling into out market. Yet during the summer, things began to change. Most recently, I reported that Fannie Mae will now penalize servicers who allow delinquent mortgages to ‘languish too long.’
ASC, America’s Servicing Company, is also a Wells Fargo Company. Wachovia is a Wells Fargo Company as well. So, if you are working on short sales with any of these three servicers, do not forget to do your homework!
Here are several posts that I have written that touch on some of the very same points:
Short Sale Negotiations with Fannie Mae
How to Determine Whether You Have a Fannie Mae Loan
Short Sale Expeditor
{ 4 comments… read them below or add one }
I am a purchasing a short sale from WF. The short sale letter expires Monday along with our contract. We tried to close a week ago and had submitted the HUD to WF for final approval 48 hours before closing, like they asked!! They still havent approved it!! What happens if THEY let their own short sale letter expire. We held up our end of the deal!
That happens sometimes and the person representing the seller who needs to get that approved needs to work a little harder on that. But, in the event that the bank delays, they will provide an extension for a day or two. Hope that helps!
We have WF as 2nd lien holder in our shortsale. Pay-off comes from the 1st lien holder and a portion of the buyer’s credit at closing. Is it mandatory in California that the full pay-off amount should be reflected in the HUD instead of being itemized between the 1st lien and buyer?
Usually everything is disclosed on the settlement statement. This settlement statement generally needs to be approved by both lien holders 48 hours prior to the closing of the transaction.
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