I recently heard that Dorothy’s ruby slippers are going to be auctioned off this December and they are expected to fetch between two and three million dollars. If you recall, Glinda the Good Witch puts the slippers on Dorothy’s feet at the beginning of The Wizard of Oz. Dorothy knows they are magical and learns at the end of the film that if she clicks her heels and repeats the famous phrase “There’s no place like home,” she will be returned to Kansas.
I certainly wished that I could be returned to Kansas this past week. Or rather, that I could get my mitts on those slippers, click my heels, and get one oh so special short sale to close.
People are always surprised at the Short Sale Expeditor® Workshops when we state that we have an almost perfect success rate in obtaining short sale approval letters. Short sale approval letters are not so difficult to come by. Yes, they often take forever to obtain, but often it is not the short sale approval letter that gets in the way of the closing of the transaction.
Sometimes short sale sellers get in the way of the closing of the short sale. For example, a short sale seller could decide at the eleventh hour that s/he would rather attempt a loan modification or let the property go to foreclosure. The short sale seller could also explore bankruptcy.
Other times new liens appear on the title report after the approval has been obtained. For example, I recently had a short sale ready to close and when the title company ran the title again, two new abstracts of judgment from credit card companies appeared. Since the banks generally will not pay for abstracts of judgment, this is going to be one tough short sale to close.
Tenants occupying short sales can also hamper a short sale closing. If a tenant refuses to vacate before closing and the new buyer insists on purchasing the home vacant, then this could be a real hurdle to pass.
Buyers can also impact the ability to close a short sale. For example, a buyer’s loan may not be able to fund and close before the date on the short sale approval letter. Or, it is entirely possibly that something about the buyer’s finances or personal interest in the property may have changed during the short sale processing and negotiating period—making the buyer not qualified or not interested in proceeding with the purchase. Buyers can also request additional credits for repair items that come up on the property inspection. And, banks generally state that the property is sold as-is with no repairs. So, these issues can definitely impact the closing.
We hem and we haw about the length of time it takes to obtain a short sale approval. We complain about the banks’ processing and customer service until we are blue in the face. Yet, at the end of the day, the bank is only one factor in the ability to close a short sale. As you can see, there are many more—even more than I mentioned here.
Sometimes I just want to click the heels of those ruby slippers to make the short sale close. But, alas and alack, I just do not have an extra two million to spare for a new pair of shoes.
Photo: flickr creative commons by Jill