• Report: #1100956

Complaint Review: IndyMac Mortgage Services

  • Submitted: Wed, November 20, 2013
  • Updated: Wed, November 20, 2013

  • Reported By: Brian — California
IndyMac Mortgage Services
, Select State/Province USA

IndyMac Mortgage Services Doesn't deal in good faith CA

*Author of original report: A couple final notes

*Author of original report: another thing

*Author of original report: The house is worth what I was offering

*General Comment: Home Sales Prices are on the Rise Now In California

*Consumer Comment: Brian,

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I was the buyer in a short sale of a house from an owner in default.

IndyMac Mortgage Services approved the short sale with a specification that closing be accomplished by a particular date based on a 45-day escrow.  However, IndyMac did not alter their foreclosure plans which were set to initiate during the escrow period.  Loan servicing was transferred to Ocwen Financial seven days before the closing deadline, and the change of servicers made it impossible to close the deal during the final week of escrow.  Ocwen Financial then spent two weeks lying to everyone involved in the deal with regard to extending escrow and commitment to provide updated lender approval docs to allow for closure of the short sale, then without warning proceeded to reneg on escrow extension, foreclosure and auction of the property within the duration of the extended escrow period they had verbally committed to approve weeks earlier, lender approval docs for the short sale which had been promised on multiple occasions were never provided.

I'm not sure if I'm in a position for any legal recourse, but would like anyone interested to know that doing business with IndyMac is high-risk where any sort of trust/good faith is involved, and that anyone should avoid doing any business of any sort with Ocwen Financial as they are completely untrustworthy and likely also highly incompetent as well.


This report was posted on Ripoff Report on 11/20/2013 12:23 PM and is a permanent record located here: http://www.ripoffreport.com/r/IndyMac-Mortgage-Services/Select-StateProvince/IndyMac-Mortgage-Services-Doesnt-deal-in-good-faith-CA-1100956. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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REBUTTALS & REPLIES:
3Author 2Consumer 0Employee/Owner
Updates & Rebuttals

#1 Author of original report

A couple final notes

AUTHOR: Brian - ()

I'll add a last couple notes to my re-rebuttal, since you seem to be ignorant of some basic facts which pertain here.

First, buying a short sale doesn't mean buying for less than market value, it means buying for less than what is "owed" to the lien holder on the property, in nearly every case this is because the borrower is "underwater" on their mortgage.  The very fact that they're in a position to have  a short sale could be interpreted as the lender having already failed in their "fiiduciary duty to their shareholders" in that it theoretically means they have loaned out more money than the collateral (the house) is worth, and they therefore couldn't recover full value even by foreclosing on the propoerty (not even factoring in that houses will usually dell for less at foreclosure auctions since they're sold "as-is" to buyers who are not allowed to look at anything but the exterior of the buildings).  If I was trying to get the property for less than it's worth, it would stand to reason that I would have been outbid since in a market that's as recovered as you think, there must have been someone else willing to pay "fair" value that would have exceeded my offer, but that didn't happen.

Second, for the lender, agreeing to a short sale is an alternative to foreclosure.  The "bad faith" by IndyMac lies in the fact that they agreed to accept my offer on the short sale (I'd post the paperwork to prove it, but it contains personal info about myself and the seller which it wouldn't be appropriate to make public) and entered into escrow on the deal, but proceeded into the foreclosure process by transferring service to Ocwen a full week before the end of the escrow period (this change in the servicer made it impossible to close the sale during the final week), and Ocwen was outright lying to the seller, first claiming that they'd approve an extension and later promising to produce paperwork enabling the sale to close.  Nobody involved was even informed of the foreclosure until the morning of the day on which Ocwen attempted to auction the property, failing to recieve a single bid meeting their minimum of 3% more than the price I had offered originally.

Finally, a major factor in the rise of sale prices in CA (at least in my area) over the last year has been severe lack of homes up for sale and relatively heavy activity by flippers who are once again creating artificial demand and jacking up prices for flipped houses by charging premium margins for often marginal improvemnents (most of the flipper houses I looked at were charging top $$$ for having "new appliances" because the flippers had put in bottom-of-the-line Fridigaire junk that'll need to be replaced again by unsuspecting buyers within the first year or two).  This lack of inventory has been exacerbated by banks holding back many REO properties in order to create artificial scarcity (I'd do the same in their position, but it's still a form of market manipulation).  Also, price trends since 2012 are interesting, but really have little or no bearing on my case since my offer was submitted in early August 2013, and accepted in late September 2013 with the sale set to close by early November.

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#2 Author of original report

another thing

AUTHOR: Brian - ()

Also, CA is a non-recourse state, the lien holder cannot pursue the homeowner for anything more after foreclosing the property.

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#3 Author of original report

The house is worth what I was offering

AUTHOR: Brian - ()

According to the appraisal required by my lender, the value of the property is what I was offering for the short sale which was actually more than the original value of the loan which ultimately led to the foreclosure, but much less than IndyMac claimed was owed after having crsumably capitalized 2+ years worth of payments since the loan adjusted and went into default.

Also, Ocwen Financial has already attempted to auction the property, and failed to recieve a bid with the minimum bid set at merely 3% more than I had agreed to pay in the short sale.  If there's a ton of extra value in the property that I wasn't paying for, then why is it that nobody else was willing to pay a very small amount more?  That's not even getting into the fact that the house had been listed for nearly 2 months on the short sale before I made an offer (in a neighborhood where everything around it was getting multiple offers above asking within the first week of listing), and they recieved no higher or backup offers in the three months between my offer being made and the foreclosure.

If they had actually sold the place for more than I was offering, or had even received any bids other than mine, I'd actually agree with you.  However, if I were offering on the property now, knowing what I learned from the home inspection and termite report during the escrow, I would actually offer 2-3% less than I did.

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#4 General Comment

Home Sales Prices are on the Rise Now In California

AUTHOR: IamGood - ()

 The Investors who own the mortgage on this forclosed home have a fiduciary duty to their stock holders to try to recover as much money from the house as possible. There was no bad faith here.

Year To Date Home price increases in California (average for the entire State) have increased 23.3 pct since 2012.  (see attached web page) http://www.zillow.com/local-info/CA-home-value/r_9/

To Sell Short to you, would not be in their best interests.  You wanted to get the house at the best, and lowest price possible, but the Bank wanted to sell the house for as much as possible.  I think if they hold off a little while longer, they will get FAR more money than they would have gotton from you.  PLUS, they can still go after the old homeowner to pay any balances due, that the sale of the house did not cover.

Go try to buy another house, but be prepared to pay Market Value Now.

The housing bubble has fixed it's self.  It took 5 years to do it, but It got done.

 

 

 

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#5 Consumer Comment

Brian,

AUTHOR: Karl - ()

You can 'Google' this- INDYMAC BOYS GET SWEETHEART DEAL, and watch that video on the web for important information.

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