Bank of America Short Sale Negotiator update

By
Real Estate Agent with Keller Williams Realty
http://actvra.in/hC

Finally, some honesty! I just had a great conversation with a negotiator from Bank of America for one of my short sales. The good news is that the short sale was approved. The bad news is that Bank of America's approval letter provides for them to pursue a deficiency judgement for the difference.

This loan was a "purchase money", "non-recourse" loan in the state of California. That means that the only recourse the bank has is to foreclose on the property. So, the upshot here is that if the owners sign that short sale approval letter they then become liable for the difference.

Of course, no responsible real estate agent would allow their client to sign a letter as such without attorney review. And, of course, no attorney would advise their client to sign that letter because it makes the future consequences worse than foreclosure.

The negotiator at Bank of America says there is no way to change the letter to a "non-recourse" approval. He says that Bank of America requires this language on all short sale approvals. He also suggested that I give any future Bank of America short sale clients a copy of the recourse approval letter in advance so they can agree or disagree to that language in advance.

The negotiator and I talked a bit about how this was a complete waste of time for everyone involved. He actually seemed sympathetic.

My clients are now considering bankruptcy and I will likely not be accepting Bank of America short sale clients until things change.

What a pity for everyone.

Oh- in case you think they won't come after your client- just let that go. Bank of America will likely sell off that right to pursue  for the deficiency to someone who will wait in stealth for just the right moment to go after those sellers- I think they have 4 years to do so. At least here in California.

 

 

 

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Anonymous #39
Anonymous
David

I am purchasing a KAtrina Damaged home outside New Orleans through a short sale.  My seller was the Deficiency Judgement clause removed.  Someone at BOA told my agent there is a way for the seller "buy out" that clause with cash.  Do you know what percentage of the remaining money would be required for this buyout? 

He purchase the home 2 years before Katrina for approx 170K and I have agreed to pay 75K, as the home is still gutted to the bare studs on the first floor. I am assuming he may still owe about  90K.

It seems most people are having the same trouble getting in touch with the negotiators.  I am an enlisted soldier leaving for Afghanistan for a year in MArch and need to complete the purchase and have the house repaired for my family before I leave.  We have been emailing and calling, but are having trouble getting a resonse. 

Any advice on this would be appreciated.

October 19, 2010 12:41 PM
Rainer
22,380
Daphne Peterson
Daphne Peterson
Keller Williams Realty

Hi David,

I wish I could say there was a definite answer. A lot depends on the investor who owns the loan. Hopefully, your agent is skilled at dealing with the banks regarding this type of situation. If the agent is not, perhaps their is another agent in their office or elsewhere that can work as your advocate on this.

Good Luck and I wish you a safe tour in Afgahanistan.

Daphne

October 21, 2010 02:41 PM
Anonymous #41
Anonymous
Dawna

I am a seller on a short sale with BOA.  It has been a paperwork, documentation, negotiating nightmare.  We are going on 2 full years since our process started.  3 different buyers because BOA takes so long, they got tired of waiting and walked, We finally thought we were getting close - had negotiated getting the deficiency waiver and us signing a $6000 promissary note at close - only sticking point was negotiating the amount that BOA would give to the second mortgage.  NOW after 7 months with this final buyer, and AFTER they agreed to the promissary note, they are now coming back saying they want cash at the table- BOA abslolutley does not deal in good faith- we are done with this process!  They can foreclose, I will live in the house rent free for a one year redemption period ( Michigan law) and then we will file bankruptcy to get rid of the debt.  What I dont understand is, they have had 3 willing buyers - instead, I have lived there for 2 years making no house payments, they have postponed the foreclosure sale several times and now they have to wait another year to actual take posession of the home.  I won't be moving out a day sooner!  Not sure whose making the decisions for BOA, but someone should make the higher ups aware of what is going on.  I know I'll be writing a lengthy letter!

April 08, 2011 03:37 PM
Anonymous #42
Anonymous
Laura Crabill

We are trying to purchase a short sale with BOA.  It has been 6 weeks since our offer and the equator system shows "hold" for the negotiator's status.  From what we are told, that means a negotiator has been assigned.  we are the THIRD potential buyer of the home.  The other 2 walked after it took so long to close.  We know BOA won't talk to us but I am told the seller's agent can't call them and can only communicate via email through the equator system? Is this true?  Seems like an agent can call and see where the negotiator is once one has been given our "file".  We are putting down 30% and willing to pay closing.  Seems like BOA still has a hard time working their short sales in TN.   Our lease is up in August and we really would like to close in June so we can get things done to the house.  It has been on the market for over 400 days and in short sale status for over 1 year.  Seems like they would want to get this one off their books by now. The owners have long moved out. 

May 05, 2011 10:51 PM
Anonymous #43
Anonymous
Dawna

Believe it or not...After our 3rd purchaser made an offer in Sept 2010 - BOA has agreed to the sale.  Instead of accepting a $6000 promissary note to waive the deficiency, they are accepting $100 cash. Go figure!  None of what BOA dogooseberryes makes any sense.  I am just glad to be getting out from under this mess and with a deficiency waiver from BOA and GreenTree both.  It has been a long, stressful 2 years.

May 06, 2011 09:51 AM
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Daphne Peterson

Daphne Peterson
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