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Throwing In The Towel

I had a client call me, distraught after two short sales fell through (she’s selling).  The buyers never articulated why they’d backed off.  Most buyers find better deals or get concerned about the uncertainty and delays of a short sale, so it wasn’t surprising to me that their attorneys just stopped returning my calls and emails.

But it was infuriating to my client.  She’s relocated for work, and is trying to establish her family in another state.  She can’t afford to carry the house in NY and pay rent where she now lives; besides, the house is worth $90-100,000 less than she owes and she can’t justify borrowing from friends and family to continue to (overpay) on her mortgage.

My client made every attempt to work out a deal with her mortgage holder to lower her rate/payment or to take back the house without resorting to foreclosure.  But for almost one year, her lender has responded to each of her well-documented entreaties for a workout or a resolution with silence, punctuated by periods of apathy.

So this client let me know that she won’t be needing my services anymore in the sale of her home.  She can’t go through the long-distance process of negotiating and then consenting to every buyer’s request, no matter how far-fetched, only to then commence pleading with a wholly indifferent lender to accept less than it believes it is due.  She’s beaten and bruised, and though she gave it her best, my client has been defeated by her mortgage holder’s lack of common sense and fiscal smarts.  When they finally foreclose, they’ll find a neglected house worth at least $150,000 less than the short sale price last proposed by my client’s real estate agent.

My client will carry the thrashing of her credit scores for years even after the court proclaims the lender the “champion” and awards it the coveted title to the house. It’s a lose, lose situation for all concerned, and for the greater marketplace as well.

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