Beware the short sale....

[Faust]

This is only one case but I will be there are more.

I work at a title company and we processed a short sale transaction in 2010. All paperwork in order and completed.

Seller got a letter from boa that they were putting insurance on the mortgage since they said none was in place for the mortgage. The seller called and told them the house was sold at short sale and the mortgage was paid with the closing funds. Boa now says they don't know anything about the closing and they have no record of having received a wire.

The seller then faxed them all the evidence that the transaction had in fact taken place and the funds being wire to them. Boa says if the information does not come from their research department then it cannot be accepted as proof. Boa says the seller must pay the mortgage amount of $175K +.

This is insane! I have been dealing with this file for a week now and am getting nowhere. I do know that telling people that they owe tens of thousands of dollars when you do not should be a crime. If it was made a crime I bet there would be a lot less of this and better recorded keeping.

I don't know what the hell is going on at boa but they are insane! I get the run around every time I call and they give a different time frame for receiving faxed into their system. They told the realtor who is also trying to help resolve this that they cannot keep up with files because they have MORE THAN 800 THOUSAND of them!!

[tobee43]

well that is very interesting.

however, if the money was wired to them and there is proof, time for the sellers to get themselves a great atty. also, as a title company if your company was the one handling the closing, what a mess, can't they come after the company you work for as well, since the money transfer transpired during the closing process??

[Faust]

They can try to come after us but we have the Federal Reserve reference number on the wire we sent them. We also have the dismissal from the court and a letter from the boa attorney stating the transaction has been completed.

[Faust]

I don't understand this part of your statement:

"time for the sellers to themselves proof"

[tobee43]

I don't understand this part of your statement:

"time for the sellers to themselves proof"

??? i'm not sure what you mean.

also, if your company has the federal reserve number etc., can't you help these people by providing the info to boa?

and your so correct about bof. actually, here where we are if you go into the banks they have NO ONE that can help you with anything other than take your money. if you need anything they themselves have to make numerous calls to people they don't even know for answers. it's terrible.

[justbroke]

I had the same problem albeit not in a short sale.

My title company "forgot" to issue the checks/wires. This was created by what they call a "dry" closing. It was late on a Friday evening with a 6PM scheduled closing. The buyer's creditor was on the West Coast, so we thought all was good. We get down to the final part of closing... and no money was wired. Ooops... wires shutdown at 3PM! (The title agent should have known that.)

In any event, my agent asked me if I want to close anyhow. So, not wanting to go back to that city to complete the closing on Monday, I hand over the keys and tell the buyer "good luck". About a month later I start getting "collection" calls from my former HOA and Bank. Both wanting their monthly payment. After some quick research, discovered that the money came in that following Monday -- into the Trust account at the Title Agency. The agent "forgot" all about the closing and the money just sat there with NO CHECKS issued!

In the end, it was fixed. However, it did get touchy there for a week. You see, I would have needed to sue the Title Company and then evict the "buyer" if it didn't get addressed. We are talking $460K at this sale. That's a lot of money, but in a Title Company's account... there is probably millions sitting there.

(My title agent learned a harsh lesson as well. She ended up needing to eat $1,900+ in accrued interest. Perhaps her E&O insurance kicked in, but it was a hard lesson.)

Oh well... I learned my lesson. No more dry closings!

[Faust]

We are trying to help these people and I have given them all the info that I have but we are getting nowhere. Yesterday I faxed them the customer's authorization (that they already have) about 40 times from our fax machines. I hope their fax system explodes.

I don't know what goes on at other title companies but it is not happening here. Our company bank can only send out wires up to 4:30 and we let everyone know that. We almost never allow dry closing and then only on cash sales. We have heard all kinds of stories about monkey business at title companies but that kind of crap doesn't fly around here.

[LadyInTheRed]

Faust, wasn't a release of BoA's lien recorded at the close of escrow?

[Faust]

No, they don't provide that at closing. Only after they get the wire or whenever they feel like it. Usually whenever they feel like it since there are no "satisfaction police".

[LadyInTheRed]

No, they don't provide that at closing. Only after they get the wire or whenever they feel like it. Usually whenever they feel like it since there are no "satisfaction police".

Interesting. Sounds like buyers in short sales need to be on the ball to make sure the bank records a satisfication. I'll have to mention that to my friend who just bought a house in a short sale.

[Faust]

Good luck! In the state of Wisconsin there is nothing you can do to a lender for not recording a release.

Yet another thing that should be a crime.

[justbroke]

Two words: Title Insurance. Make sure you get a clean "Warranty Deed" in any short sale and CERTAINLY buy an Owner's Title Insurance policy FOR YOURSELF!

[Faust]

We are a title company. That doesn't solve this problem.

[justbroke]

We are a title company. That doesn't solve this problem.

It works for the buyer. I do empathize with the closing/title company. There should be more protections for all involved in the transaction. This is what title companies live for anyway, right? Insuring that proper title is passed and all parties are paid.

[Faust]

I meant this thread to be about boa being a black hole of documentation and apparently now wire transfers.

Another thing is that boa is and has been continuing to report this mortgage to the credit agencies as delinquent for the past 18 months. That is something a title company cannot help with.

Too big to fail and too big to find your wire.