What you should know if Greentree is servicing your loan

Greentree Financial has to be one of the toughest lenders to get anywhere with when asking for a short sale. I cannot say they are slow, they are actually faster than many of the other lenders I have to deal with. Their speed is probably due to their set policies, which are what cause me heart burn. In order for them to even consider a short sale, you must be offering them at least 5% of the sale price of the property being sold, before they will even look at the reason why the borrower is pleading for relief.
If the 5% criteria is met, their consideration at that point will only be to release the lien and let the property be sold to the buyer. If the loan is a recourse loan, they will not release their right to pursue the borrower for a deficiency. I can understand their policy to a point; there are some borrowers who have the ability to continue to pay bad debts. What frustrates me is when the buyer has no ability to continue to pay, and the prospect of having to do so would likely lead them to declare bankruptcy. In most cases, the buyer would just go ahead and declare bankruptcy instead of trying to do the right thing by helping the lenders as much as possible by facilitating a short sale. Once the seller/borrower declares bankruptcy, Greentree has no ability to collect any of the loan balance. Their blanket policy causes not only unnecessary hardship on the borrower, but it also causes the investors they represent to receive nothing, rather than something. In most cases, insisting on 5% of the sale price before they will even consider the sale is usually the end of it. This is due to that fact that most senior lenders will have a policy of not paying any junior lenders anything more that $1,000 to $3,000 and will not allow either the borrower or the buyer to make up the difference. At that point, the sale is dead in the water. Time and energy has been wasted by the buyer, seller, both agents, the senior lender and of course we need to include escrow and the title company who also invested a lot of work into trying to save everyone a lot of money and also earn a paycheck themselves.
The most ridiculous thing I have had to deal with recently is Greentree’s admittance that they will not consider the extenuating circumstances of one of my transactions because Bank of America is the senior lien holder because BofA would lose less money than if Greentree were to agree to make an exception. It seems that BofA has their own blanket policies which tend to infuriate the junior lien holders. I can understand that too, but I think they all need to grow up and quit doing the tit-for-tat and just look toward the bigger picture, which should be to help everyone (especially themselves) minimize further loss and look forward to better days ahead. Dean Carlson


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