Monday, June 11, 2012

Short sale and appraisal crisis averted...but it put a crimp in my afternoon schedule...

I visited a short sale condo in Natomas today that I have in contract with a buyer should have been a 5-minute visit to the property to let myself in, to install a carbon monoxide detector before tomorrow's appraisal, and then leave. But those plans were thwarted by Safeguard Properties. It's not really their fault...they are just doing their jobs.

Ever heard of them? No? They are a "property preservation" company. They work on behalf of many loan servicers (like CitiMortgage, GMAC, Chase, Bank of America, Wells Fargo, etc), and they employ field reps that monitor properties in default or with past due balances. Why, you may ask? Their sole job is to make sure that the bank's "assets" (aka, properties their loans are on) are in decent condition, being properly maintained by their occupants, and that they are properly secured. If that field rep determines that a property is vacant, not secure, or not being properly maintained, those reps post notice on the house (usually on the front door or front window) requiring that the occupant or "responsible person" contact them via a toll free number immediately -- usually within 2-3 days. Occasionally the listing agent or homeowner will receive a follow-up call once this notice is posted, but not always. If nobody contacts the field rep, then many times that person, who is acting on behalf of the loan servicer, will take it upon him/herself to make sure the physical integrity of the "asset" is not compromised. What does this mean?? Usually it means they change the locks and take whatever measures they believe to be appropriate to secure the house (like board up windows, lock side gates, etc). I blogged about this a couple years ago.

I always give my short sale sellers a heads up that monitoring from a property preservation company like this is a possibility, and that they really need to make the effort to maintain their property if they are not living there, keep it secure, and monitor the house for notices of this nature.

This listing agent did not prep her seller. So, when I arrived to open this unit to install a carbon monoxide detector, the key in the MLS lockbox did not open the lock, and there was another combo lockbox on the front door. I ended up waiting around for more than an hour while the listing agent called the field services rep to get the combination to the new lockbox on the house. Once she was able to give me the combination to this new lockbox, I entered and installed the carbon monoxide detector, and I then had a look around. I noticed that none of the lights worked and the toilets were empty. I found the electrical panel and all of the breakers were in the "off position." I turned them on. I also turned on the water to the toilets and made sure they flushed properly.

Thankfully I visited the house today, BEFORE the appraiser was scheduled to come out tomorrow...most likely he would not have waited around for an hour while the listing agent obtained the combination to the new lockbox, and may have charged an additional fee to my buyer client to re-visit the house at a later date. If the appraiser had indeed waited around, then the utilities would not have been operable for his inspection, which would have also required him to make another visit to the property. Either of these scenarios would have cost my buyer money and the timeframes in the transaction may have been delayed.

So after nearly 90 minutes at the house, I put a copy of the new key in the MLS lockbox for the appraiser to use tomorrow to access the unit, made sure the utilities on and light and plumbing fixtures functioned properly, oh yeah, and I installed that carbon monoxide detector -- a potential crisis was averted...

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