Heard from a rep at Quicken Loans, the loan servicer for Schwab Bank/PHH mortgage, that Schwab Bank Moretgage only will consider near-full payoffs on short sales of homes that it had financed. Which, naturally, entirely defeats the purpose of a short sale for 95 percent of the population who may be considering such a move here in the Phoenix area.
This is one of those areas where logic has taken a holiday. All statistics show lenders receive a better payoff on a short sale than on a foreclosure. And yet, Schwab Bank will not go that route, preferring instead to believe saying no will cause the homeowner to start paying their mortgage once again in spite of whatever hardship may have befallen them over time.
But at least Schwab still has the homeowner go through the considerable effort of requesting an Application for Success from Quicken, soliciting offers and submitting a full short sale package just to find out the answer’s been no all along.
Should this change, I’ll provide an update.