AHMSI Short Sale Department-Are They Greedy Or Just Plain Stupid?
On July 14th, 2010, I wrote a blog titled "Congratulations AHMSI Short Sale Department... You Just Bought Your Investor Another House!". Had I known then what I know now, the title to the post would have read something like this; "AHMSI Just Lost Over $50,000 For Their Investor".
You see, I have a client who stopped making his $1,800 per month house payment in February/2009. AHMSI filed for foreclosure, and the date was set for July/2009. To make a long story short, my client moved out of the home in June/2009, expecting to lose his home at the auction. Unbeknownst to him, AHMSI decided to postpone the auction, and continued to postpone it until they finally foreclosed on July 26, 2010. Yep, you heard it correctly. After 18 months of missed payments (for a total loss of over $32,000), AHMSI finally decided to allow the foreclosure auction to take place.
There was over $254,000 owed on the home, and AHMSI agreed to sell it at the auction to an investor for $59,000! Today, the home is back on the market, with an asking price of $89,000. So, what's the problem, you ask?
We listed his Arizona pre foreclosure as a short sale in December/2009. Over the course of 8 months, we were in escrow Five Times, with five different buyers. The lowest sales price that was sent in was $82,000, and the highest (and our last) buyer was in escrow at the full asking price of $89,900.
To make a long story short, the AHMSI Short Sale Department kept countering our offers at ridiculously high prices, causing buyers to look elsewhere. Finally, they agreed to our latest short sale offer, and agreed to Greentree's (2nd mortgage) demand for a payoff of $4,495.00. I thought we finally had a done deal!
Ahhh, but wait. Two weeks before closing, AHMSI changed their mind, and told us they would not approve anything (zero, zilch, nada) for Greentree. Their excuse? Because Greentree had moved the file to their "charge-off department", AHMSI felt they should not receive any funds from the transaction. Remember, Greentree still holds the lien to the property. They did not sell it to a collections agency. They simply moved it to another department within their company.
Despite my efforts to explain this to AHMSI, they refused to give anything to the 2nd. So, as could be expected, Greentree refused to take $0.00, and we were headed for foreclosure.
So, let's do the math, shall we? The AHMSI Short Sale Department, over an 8 month period, turned down 5 deals that would have netted their investor approximately $75,000. Three weeks after turning it down, they sold the home at the foreclosure auction for $59,000. By dragging the process out since February/2009, they lost over $32,000 for their investor/client, and the foreclosure process probably ending up costing them a minimum of $10,000. So, if my math is correct, at the end of the day, the investor stands to bring in around $17,000. Now, this does not include the 18 months of servicing fees/penalties due to AHMSI (amount unknown). At the end of the day, I think the investor would be lucky to bring in anything at all.
What makes my blood boil is the fact that AHMSI received $2 Billion in TARP Funds. What a slap in the face for taxpayers, huh? In addition, what makes me more mad is that fact that we take our Arizona pre foreclosure listings very seriously. When all was said and done, the AHMSI Short Sale Department ended up costing me well over 100 hours of work, lowered the values in an already depressed neighborhood, and caused my client to have a foreclosure on his credit report instead of a short sale.
Today, I will be putting together a package and sending it to every government agency/leader and media outlet that will listen. In my opinion, , and I plan on doing everything I can to spread the word. So, you tell me...AHMSI Short Sale Department- Are They Greedy Or Just Plain Stupid?
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Bob Hertzog
Summit Home Consultants
Copyright © By Bob Hertzog 2010 *AHMSI Short Sale Department-Are They Greedy Or Just Plain Stupid?*