First Bank of Tennessee Short Sale Process

Professional, but busy. Those are the three words that describe the short sale process with First Bank of Tennessee (Nasdaq:FTN), After just recently completing another short sale with FTN it’s obvious that their system is extremely swamped with sort sale requests, who isn’t right?

Times have really changed for FTN , back when this whole nonsence about housing bubbles was just fantasy FTN might have been handling only a handfull of short sale properties. ‘My, how times have changed…’ FTN processors are now handling hundreds and hundreds of files per agent. What’s worse is that according to an inside source processors are having a tough time sticking out the extra work hours.

Although, the agents are extremely busy the process itself is rather quite easy. Unlike, some of the other big named banks (i.e. Bank of America) FTN doesn’t have any ‘escalation guidelines’. If your file is not being moved than you just call and talk to whomever is handling the property. The communication between short seller and bank is incredible. You can expect a call to be answered by FTN every time. Actually, FTN maybe a little bit too giving with their communication policy as processors spend a great deal of their time taking short sale inquiry requests without actually working on the processing part.

As if the crystal clear line of telephone communication wasn’t enough to send every home owner running for a short sale regardless if they are upside down or not. FTN also offers a steller Fax system. FTN’s fax system is routed to the same number as individual processors. This means that there is no ‘number dump’ (A.K,A, the great void of short sale faxes) where your documents tend to disapear even after being faxed 5 times.

In terms of negotiations FTN is very fair. They are playing the foreclosure % game. For example, unlike some other banks (i.e. USAA) FTN usually approves short sales the first time as long as the contracts are between 80-100% of FMV (Fair Market Value). This is contrary to some lenders who ‘say’ they approve short sales based upon the net loss to them from the sale. I have yet to meet a lender who actually bases their short sale decisions on the amount the lost (when push comes to shove).

In terms of FTN and their relationship to second lien holders, don’t expect much. FTNs policy is typically to only allow $3,000 or so to be deposited to the second lien holder. They will pick up some buyer closing costs so that is a plus (especially if the second lien holder is demanding more than $3,000. Although, the extra dough passed out for CCs doesn’t help much with second lien holders on FHA loans (since first lien holder CCs can’t usually be applied to the deliquient second lien holder demands). The CCs do make it that much easier for the buyers to part with a hard cash escrow deposit.

Despite, what some in the real estate community may think hard cash escrow deposits for second lien payoffs on short sales ARE acceptable. The cavout with the hard cash contribution is that everything must be disclosed and reported on the HUD-1 (escrow closing statement). So, if you are a buyer and want to make sure your offer gets accepted on a short sale just tell the listing agent you can make a cash contribution if need be.

To search hundreds of local short sales please visit our Quincy real estate page.

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