I have been working with short sales and sellers trying to avoid foreclosure in the last 12 months. I have also spoke to friends and friends of friends that were going through it and I have seen similar symptoms in many cases while trying to save their home. This is how I came up with the name Seller’s Short Sale Syndrome.
You can also call it Foreclosure Fatigue. After months of trying to figure out how to either keep the house or sell it, the seller just throws the towel in. The situation feels hopeless and the constant worrying gets to them. In one case a seller was using an agent that did not really understand the short sale process. She was 14 days from foreclosure and I told her that if she had her agent do some things differently she could probably get an offer.
I heard something in her voice that sounded like fear or despair. The idea of the process dragging on weighed on her even more. She took my suggestions and said she would talk to her agent. I checked in about a week later and she admitted that she just wanted this to be over and hadn’t made any changes.
I have heard that again and again. The fatigue of the constant battle inside their head as they try to figure it out. “What if I sold this?” “What if I got a third job?” “Should I keep making my payments?”
And the constant “What if…” That is the probably the hardest to deal with – hindsight in this case is beyond 20/20.
- “What if I didn’t get an adjustable rate mortgage?”
- “What if I didn’t take the new job where I lost some seniority?”
- “What if I didn’t rely on overtime?”
- What if…What if…
I expect to see a flood of short sales, foreclosures and bankruptcies coming our way in part to the this Syndrome. Often these sellers keep just a few people in the loop, if anyone, to what is happening to them. It is embarrassing regardless of what their “What if…?” was. The less support, the more likely the fatigue will set in.
If you are going through this then understand the ups and downs, the highs and lows of hope. If you know someone who is going through it, lend a ear and maybe help them stay on task, moving forward with a short sale or loan modification. The idea of losing your home, possibly followed by a bankruptcy, while wondering how far you got in the last 5, 10, or 15 years as it seems to get flushed away can make even the most stoic pause for reflection.
To those who are angry that people are getting bailed out for their bad loans while you are stuck with negative equity, remember, that in every case that I am familiar with, the homeowner had to be late in their payments to get a loan modification or show a hardship to get a short sale. Missing payments on your home is the last thing that a creditor wants to see on your report. If the seller loses the house to foreclosure it will be a long time before they get a good credit score. And good doesn’t even cut it any more. Some banks are requiring 740.
Keep trying, even miracles happen. A client, at the end of his deadline, decided to try a loan modification one more time. “What the hell”, he thought. The bank hadn’t given him a second thought when he tried four months ago. This time they gave him two months postponement to gather paperwork. Two months is the longest I have heard for a postponement. Typically they give a month with a short sale offer. Don’t give up.
While dealing with Seller’s Short Sale Syndrome or Foreclosure Fatigue, it does help to remember this one thing, “This too shall pass.
