Should I try a short sale (Bank of America)?

[my1sthome]

After 2 1/2 weeks of applying a regular conventional loan with BOA, I'd have to say, keep away from BOA, I mean just go somewhere else, it's going to be your worst nightmare. I thought I gave them a try and now it's stuck at underwriting...had to apply elsewhere to see if I'll make the loan contingency deadline extension...my company verified everything, CFO signed all papers, all docs in, all LOE (letter of explanations) in, 6 fig income, 760+ credit score, 10 years of revolving accounts with not a single late payment...rental history, not a single late payment and BOA still has doubts, doubting that maybe I got lucky from this job because I jumped from $50K salary to 6 figs...if you BOA has doubts, why the hell you need paystub then? doesn't 5 months of paystub prove anything? Anyway....

just keep away from them, you'll live a happier life and have less dark circles and burn less brain cells...I didn't believe , now I do...no good.

[1999corvette]

Well I am trying with the HAFA program.

You have to miss 60 days to be considered, in the mean time BofA calls every day asking when I'm going to pay, even though I explained the situation.

I told them Friday, and they called again tonight, and the lady asked if I had gotten a job, I said "not since Friday, no"

Also, the HAFA person at BofA told me to list the property and get bids, then I said "on your website, it says you get approved, then BofA determines the asking price, then you list it"

The person said "oh, we don't do it that way"

So, they don't really do HAFA, maybe HAFA-assed short sell.

[hilgi]

Just find an agent who specializes in Short Sales, they take care of it all for you.

[SmartMoney]

Just as an FYI, back at the end of May, Fannie quietly (almost hidden in the announcement) stated they were not going to finance any foreclosed properties that did not go through their State's redemption period. In some states, that is as long as one year. That means the home could not be sold for one year! So, in their big hearts, BofA announced it was shifting emphasis on short sales. What nice guys!

I've sourced my comments:

Know Your State's Foreclosure Redemption Period

Bank of America Puts Short Sales Ahead of REO « HousingWire

[2bindenver]

It's important that if you are going to sell, you hire an experienced short sale broker.

Ask how many have you completed? What is your policy on submitting more than one offer? How many have been foreclosed on? How do you prepare/pad the estimated the HUD?

[naeem5]

Originally Posted by 1999corvette

I read also the government will give the seller 3000.00 to cover moving and rent deposits, is this true?

yes....I thought it was $1500 but read here. It also explains why short sales take awhile.
Homeowners Offered $3,000 to Sell Short

I'm not clear on how your bank, Bank of America, can list the house. I have been going to foreclosure auctions and found a home in foreclosure and I wanted to pursue a short sale. But, it requires the owner and the bank to approve a short sale and I can not find the owners. They moved out 10 months ago.
THEY are the legal owner until the bank puts the home up for sale at our county foreclosure auctions and has someone represent them at the auction, such as a lawyer. I know the lawyer who bids on about 80% of our auctions each month. The bank always bids first and almost all the time he will bid $2500, low, because the court fees to the bank are 1%.
If no one is interested in that house, the bank NOW owns it, they'll decide to make any repairs, they'll list it through an agent and before the listing, if it is occupied, they will evict the tenant.

I think, legally, YOU own your house until the bank forecloses and you agree to a short sale to THE BANK, or ME, or it is sold at the county foreclosure auctions to the bank, an individual looking for a house, or an investor who wants to rent it out.

Maybe the process is different in each state, but in my state no matter how far you are behind in your payments, you ARE THE OWNER until SOMEBODY, a home owner, investor, or the bank buys it at auction. However, with this $3000 incentive the banks might as well go the short sale route rather than pay $2500 to buy the house at the auctions.
And at the auctions the banks have 2 choices, place a bid or ask for a deficiency judgement. If they think your house won't bring the amount you owe on it, through the auction, they will ask for a deficiency judgement. Bidding will commence and when it stops, if for example, you owe $58,600 on your house and the bidding only got to $33,000, the request of a deficiency judgement by the bank means:
All interested parties will return 30 days later and the bidding will pick up where it left off and the higher bidder gets it. And the bank goes after YOU the foreclosed on person, by trying to sue you for the difference between what the house sold for at the auction and what you owed them.
If they know you have no assets, well, they may not go this route and hope to recover $$ from you.
What stage in the foreclosure process are you?
Has you been served papers?
Has your house been sold at auction at the monthly county foreclosure auctions?
Are you only in the stage where you are getting threatening letters?

I wanted another house and the occupant did not move out when served papers. She was served in Nov. 2009 and at that point I do not know how many months she was behind. She kept living there, driving a new car, working her job and ignoring the mortgage. In mid Jan. here comes her house on the auction list. With a few days left before the auction, it got pulled. I was ready to bid. I assumed she had made arrangements to catch up with the bank. However, it turned out she wrote the judge a letter explaining how she could afford the house. But, in mid Feb. it's on the March auction again, again pulled, then mid March back on for the April auction. She was getting it pulled and making the process as lengthy as possible. Finally the house stopped being on the auction list and I think she finally made financial arrangements to keep the house.

So you are behind so many months?
If you find a job does it let you pay the mortgage and "catch up with back payments too?"
There is a deadline after which you won't be able to stop the auction. The papers you've been served should state this deadline.

I hope you get to stay in your home. Above are the ways things work in my county and my experiences. In fact a house I want (but I can not locate the owners because they have moved out) is in the 18th month of foreclosure and still no auction.
I was told that for me to buy a house by a short sale the OWNER and the BANK must agree. If I was trying to buy your house, YOU would have to give me permission and I might give you a financial thank you of $1000-$1500 to approve a short sale to me.

The banks have many $$$ reasons to avoid the foreclsosure auctions and so do you. If you can stop the auction, it will keep it off your credit report. Otherwise if your house is sold at auction, it may be on your record for up to 9 years which is worse than a bankruptcy.

I spoke with a real estate agent who specializes in foreclosures. The debt owed on the house was $38654. She said try a short sale, and she bet the bank might take $30,000. I sure liked the sound of that. But, this house was the one above, occupied, and the lady would not consider a short sale and would not speak to me or my agent at all. So, the banks will give discounts in short sales.

Good luck.

[Steve Foster]

I own a home in Omaha, Ne. that I tried selling for the past three years after moving to Kansas City due to a new job. I kept up with the payments for the first year and then I started getting behind on all of my bills. During that time span the market was down and homes were not selling. I did not have any offers on the home that first year. I had 5 offers over the next 18 months to purchase the property and the price was $15,000 to $20,000 less than what the payoff amount was on the loan. The original loan was with Countrywide and I filled out the proper paperwork to do a shortsale with them. I was told by the short sale person at Countrywide that all of the paperwork was in and it should be approved in 30 days. During that time Bank of America bought out all of the Countrywide loans and my shortsale fell into their hands.
Since Bank of America took over the shortsale contract on my home it has been a complete nightmare. Over the past year and a half, I have had 5 buyers for the home which all fell through because Bank of America never got the approval done in a timely manner. They are taking anywhere from 3 to 4 months to get approvals done. During this course of time my realtor and I have had to deal with the following with Bank of America:
* Paperwork that was faxed to them and sent by email was lost on many occasions and it had to be resent. At one time I was sending a PDF file with the paperwork in it every week just because I knew they were using it as an excuse to delay the process.
* You cannot talk to anyone responsible at Bank of America in the short sale department. All you can get is a customer service representative who checks your status on the computer and usually there was no update even though I or my realtor would call every other week.
* When I or my realtor did get a supervisor or a short sale person that was handling my account - they were often rude and only would tell me where I was in the process. I just kept getting told that they had so many short sales that they could not give me any idea when the process would be complete. Two of the individuals commented that if the buyer left - just go get another one and start the process all over again. Well that has happened 5 times now and the results are the same - Bank of America is so slow and there is absolutely zero communication on their part as to where we are in the process to give some feedback to the buyers.
I wrote 2 letters to Bank of America and sent them via email and one hard mail to the CEO of Bank of America and I never got a response to why they even have a short sale division since it absolutely fails every time due to incompetence in the department. I have honestly believed through the process that it is intentionally delayed for their own behalf - whether it be tax write offs or maybe the government is giving them another 25 billion to help homeowners.
I was taking a $20,000 hit on my loss on the home and Bank of America would still not do their part to get this sale done. The whole short sale department for Bank of America is a total joke and I am not laughing about it. They may as well shut it down and get rid of all of their employees because they are not sevicing anyone. The government and Barrack Obama should not help out institutions like Bank of
America - because they are just taking the money and not accomplishing anything with it. I am sure the board and high banking officers got their bonuses each year while this was going on. Well I for one am not too impressed with Bank of America as a viable banking entity and the management needs to go back to school to learn how to deal with people.

[mortimer]

Originally Posted by Steve Foster

... Bank of America ...

Earlier in this thread, there was the question about who was getting the "Free Ride."

At first, I would say the mortgagee, but then BOA isn't really a mortgagee these days, are they?
They are just the servicer getting the fees, and the fees, and the fees ....