One week remains until my house is foreclosed upon a public auction sale in the morning on November 25^th.  I’ve become rather nonchalant about the matter until the thought of being tossed out on my ear by the sheriff lit a fire under my ass over the past few days to explore all of my options… yet again.  The short sale is at the top of my spelunking list.  With only 7 days left until foreclosure it’s more than a little late in the game for me to pursue a short sale but I cannot rid myself of this notion there must be a way to let my house go with a little grace and dignity.  The looks on my neighbors’ faces when the sheriff shows up to change the locks on my house keeps me awake at night and out of sight during the day.  The thought of a large foreclosure notice tacked on the front door calling out to all would-be pillagers to strip anything of perceived value from the house disturbs me.  When I imagine the chain link fence wrapped in bright yellow caution tape rising up around the house my heart sinks.  I picture the lender calling in a bulldozer to level this nuisance I once called my home and it makes me want to crawl into a hole and disappear.  A bulldozer?  Really?  C’mon, that’s a bit much don’t you think?  I do not think.  If I did I wouldn’t be in this mess.  I also do not think for one second this scenario is of the worst-case variety because I witnessed such a thing a few months ago four short blocks away from my house.  If you care to see a photo and read about that foreclosure tragedy be my guest and go here… if you dare.  I have no need to revisit the images or the words of the entry because they reside clearly in my everyday thoughts and fuel the fire of desire to leave my house gently… and quietly so as not to disturb the neighbors.  A short sale is the way to accomplish this… or so I’ve heard.

The trusty rusty internet is bound to hold the keys to unlock the mystery of the short sale.  It’s great to live in a digital age where information is just a mouse click—blah blah blah.  The problem with the internet when it comes to reliable foreclosure and mortgage information (and often any reliable information) is that it’s a maze filled with dead ends perpetuated by profit.  The Google ads littering the page of this entry are a perfect example.  As I’ve said in the past, if you’re looking for help with a foreclosure DO NOT CLICK ON ANY OF THEM.  If you’re looking for accurate information about foreclosure DO NOT CLICK ON ANY OF THEM.  If you’re looking to contribute 0.00000004 cents to my Google Ad Sense account DO CLICK ON ANY OF THEM (thank you sueinaz – I’m almost up to 0.000008 cents due to your generous efforts).  Most of these cyber hallways of the foreclosure maze turn out to be dead-end fronts for loan modification outfits run by who knows who.  Even if there were a hunk of cheese waiting at the end it’s going to be moldy and rotten by the time I find it.  I’m such a human garbage can I’ll probably eat it anyways, get a stomach ache and be forced to ingest large amounts of laxatives just to be comfortable again.  Months ago I redefined comfort as a roof over my head that doesn’t leak, running water, electricity, a bed to sleep in and a pillow to drown in my drool.   If there’s money left over for the occasional manscaping of my chest hair I would like that too.

I also define comfort as uncovering the truth behind a problem.  Foreclosure is a problem.  Short sales are touted as a solution but finding the truth behind it all is a daunting task so it’s time to call on an expert.  One need only to look as far as real estate broker and author Elizabeth Weintraub for guidance on debunking the myths of the short sale.  Besides authoring the book titled The Short Sale Savior she writes for the New York Times and serves as a media source for the L.A. Times, CNN and The Washington Post to name just a few of the media outlets preempting foreclosure crisis news with articles on the latest Sara Palin controversy or gossip surrounding the release of Twilight.  On top of all that she’s a real estate broker who has been in the business of negotiating short sales with lenders for years… before it was the cool thing to do.  Her long list of qualifications matter little to this foreclosee - she had me at “savior”.  I do not care what kind of fundamental church she runs so long as she schools me in the fundamentals of the short sale.  However, I choose not to discuss my own foreclosure situation with her during our interview for two reasons:  1) My prior research indicates I’m an unlikely candidate for a short sale and 2) Explaining my debacle of a foreclosure will likely elicit a response from her in the realm of, “I’m sorry, I only speak to writers who have 0.000000001 milligrams or more of cognition in their brains.  Given your reckless tale of foreclosure woe I’m surprised to hear anything but gibberish from your mouth.  Goodbye.”  Thankfully I installed a gibberish translator behind my tonsils a few months ago and thanks to that gem of technology we promptly enter into a lengthy discussion about short sales.

When asked to define the term short sale in as few words as possible Elizabeth responds, “A short sale is selling your property for less than you owe.”  Essentially, if you owe $500,000 on house (which I wish I did) and want to sell it to someone for $400,000 (which I wish I could) the transaction is designated as a short sale.  While the definition sounds simple, the actual process is anything but.  In a nutshell and in her own words she writes in one of her about.com articles:

"Here are sample steps of a short sale:

• Seller signs a listing agreement with a real estate agent subject to selling as a short sale with third-party approval.
• The agent finds a buyer who makes an offer for less than the amount of the mortgage.
• Seller accepts the buyer's purchase offer.
• Seller's lender accepts the buyer's purchase offer.
• Transaction closes when the buyer delivers the funds, the lender releases the lien and the seller delivers the deed."

Again, when taken in on a cursory level this process appears straightforward as a lender’s claims of wanting to help distressed homeowners.  A look beneath the surface reveals evils lurking in the depths below.  In order to qualify for a short sale and avoid foreclosure homeowners must submit themselves to rigorous scrutiny by the lender in which the entirety of their financial portfolio is splayed out on table.  This includes but is not limited to a hardship letter, tax returns, paycheck stubs, bank statements and retirement/brokerage accounts.  In short, anything and everything that paints a complete picture of one’s fiscal status must be divulged to the lender.  As the lender sniffs through the application they’ll insist upon devouring assets from the homeowner to put toward the deficiency of the mortgage from the short sale.  Whatever you do, do not underestimate the lender’s appetite for your money, liquid or otherwise.  Elizabeth related more than a few horror stories but one egregious short sale negotiation with a lender stood out.  It involved a prior Countrywide Home loan now handled by Bank of America (my lender du jour).

“I had Countrywide come to me on a deal and say, ‘you know we’ve looked over your seller’s credit report and she has excellent credit.  Her scores are in the high 800s.  She really is just a model borrow… except for this property and her medical problems and the fact that her husband lost his job.  But she also has a bunch of credit cards that have very high balances and she doesn’t owe anything.   so what we want her to do is go to the bank and tap those credit cards and give us the money.  We don’t care if she makes the payments on those credits cards, we’ll take the money.’  I can be a pretty calm person but I started to scream at that woman,” Elizabeth says.

I’m so angry at this point I want to ask for the woman’s phone number at Countrywide so I can scream at her too but it would be foolish to waste Elizabeth’s precious time haggling over a phone number.  Besides, the interview is already running well past the time allotted and there’s still much ground to cover.  Similarly, this entry is running past the pages allotted so stay tuned for part two of Foreclosure & Short Sales: Outsourcing Foreclosure Overseas. WHAT?! for more horror stories of short sales gone awry and a further investigation into the quagmires of the process.  Forgive me if I have to run out the door prematurely.  There’s a cheese shop down the street that closes in 10 minutes.  I hear they have a special on Aged Loan Modification… or so they say.