With almost 1 in 5 home loans in Florida originating from Bank of America formerly Countrywide, it is highly likely that if you are looking to purchase a short sale or sell a property as a short sale it is serviced by Bank of America. Team Baranowski has dealt with dozens of short sales with Bank of America and we are slowly seeing the process attempting to be standardized and streamlined. See a post about Bank of America’s streamlined process here.
During one of our many short sale negotiations with Bank of America, we received a very detailed and information packed emailed that detailed some of their new and not so new polices that are being pushed down from their Senior Vice President to the hundreds of Loan Services Specialists in the Short Sale Department. The not so new polices seem to now be formalized and documented versus recognized as a standard practice.
Since the email is confidential and secured, I am not able to post it here. However, this is a snapshot of the critical points to Bank of Americas new short sale policies.
- Bank of America continues to adhere to the 10 to 12 business days for a negotiator to review the short sale file. This is typically through each phase including: short sale submission, triage, Level 1 Negotiator, Level 2 Negotiator, Investor Review, and Level 3 Negotiator
- Under NEW GUIDELINES it is now necessary for MOST sellers to contribute to the loss in order to qualify for a short sale. Clients must be prepared for this probability. Contribution will be in the form of cash or a 0% 15 year promissory note. Contribution requirements are assessed on a case by case basis. Determining factors include: if the seller is current on other debts, as reported on the seller’s credit report, then the contribution will be a firm requirement.
- Bank of America will contribute a MAXIMUM of $3,000 towards a 2nd mortgage pay off. This has been a standard policy and it now appears to be a firm policy. If Bank of America owns both the first and second mortgage, please pay close attention as Bank of America has been selling off their second mortgages. This will have an impact on your short sale payoff. If you have specific questions about this please contact me.
- Fees that will not be paid by Bank of America and must be removed from their side of the HUD: sub escrow, recording fees, recon fees, doc prep, processing fees, wire fees, notary fees, courier fees, loss mitigation/ 3rd party negotiation fees and home warranties. All of these fees will not be paid by the investor that owns the loan.
We have had great success with Bank of America short sales. It takes patience, diligence and deep knowledge of their processes to work through system. We have had short sales approved in 6 weeks and some take as long as 5 months. Bank of America short sales is the most popular and heavily discussed topic on my blog and I get emails and phone call daily in regards to this topic.