The banking crisis is bleeding over all aspects of our lives: interest rates are plummeting, the value of the solar is dropping, and the cost of everything is going up. Meanwhile the weakened economy has jobs still scarce, pay stagnant, debts harder to pay, and credit harder to come by.
We’ve said it before, and we’ll say it again: the economy and housing market are closely tied, and in far more ways than one. Here’s one potential homebuyer’s story:
It’s been a rough year, but we’d finally gotten back to work and back on our feet, and were ready to buy a home. It all seemed ok: we had a solid pre-approval, and we found a home we loved. We even offered the asking price without the typical strings and caveats, we were ready to pay our own closing costs and close quickly. Why couldn’t it have been as simple as that?
We were told going in that the home was a short sale and things would take longer; we accepted that. We crafted our offer to be as clean and uncomplicated as possible: just the type of offer a bank could approve quickly – so we thought. When our offer was sent out we hoped for a quick response, but we expected three weeks, after all, the selling agent had experienced that wait time on a previous offer that was rejected, surely our good offer would be accepted in that time frame at the most!
Little did we know, the drama was only beginning, and not just for us. The weeks dragged on to four without a response, then, finally, a counter-offer – $10,000 above the list price! As much as we wanted to be surprised, part of us wasn’t. We figured the list price was a ploy to get bids in and the bank needed a certain amount on their end of the short sale, but there were no other offers but ours. Still, we reencountered a predictable half-step, and expected it to be accepted. Yet the days dragged on and our calls were met with nothing. When we finally got some news, it wasn’t at all what we expected.
It turned out, all of our problems began and ended with the selling bank itself: they were going through bankruptcy! We came to sympathize with the poor seller – he wanted to badly to sell us the home – but he couldn’t get the bank to do its part. The home had already gone through several case managers (seems the bank couldn’t hold onto employees), and his last one left without telling him or leaving a new contact behind. It took the seller those first four weeks to track down his most recent case manager, and she promised to view the file within the week – that’s when the counter-offer finally came. After that, well, we just don’t know. The seller couldn’t get anyone to return his calls. He even tried complaining up the chain to higher management to no avail.
Eventually, we just couldn’t take it anymore, retracted our offer, and went back to house hunting. This time, we swore, no short sales! We might have been happier with the first house, but for us, the banking crisis had created a gulf we just couldn’t see the end of. Within two weeks we found a new home with a motivated seller, offered, negotiated, and signed a contract.
Our part in the drama is over, but for someone else, it may be starting all over again. Good luck to the next buyers; may they be more patient than us and finally get that short sale to closing!
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About Geoff Thompson — Geoff Thompson is an Owner and Founding Partner of Express Schools, LLC. which operates online education providers Real Estate Express, Insurance License Express and License Tutor. Follow him on Twitter.