Bank of America Does It Again!

With short sales in abundance, it is very difficult to evade them. More and more of my real estate sales are short sales, with bank owned or reo properties taking a close second. There are a number of parties involved in a short sale: the lender, the negotiator, the investor, among others and each person’s role is vital to the success of the short sale.

Considering all of the short sale lenders I have worked with, Bank of America is by far, the best. From my experience, they always close within three months, unlike some of the other lenders. However, I had a recent case that threw me for a loop. In January, my client signed a contract for a two bedroom, two bath villa (short sale by Bank of America). I was confident that this would close within three months. However, three months and two negotiators later, I was drafting an extension, hoping that it will close soon. I was asked to resend a newly signed contract twice and five months into the waiting period, the contract was denied.

Stunned and confused I sent a direct twitter message to @BofA_Help, searching for an explanation. Why is this contract being denied? This doesn’t make any sense? The BofA representative responded the same day asking for further information. She researched the matter and advised me to resubmit all documents all over again and everything should be taken care of. Disheartened and a bit skeptical, I followed the instructions. This was in May. Three months later, we received an approval. My client was elated and so was I. After waiting eight months, my client now has a home.

Real estate agents have very little control on the outcome of a short sale. We always hope for the best, so all parties involved are content, especially our clients. I was happy that my client didn’t have to start the home search process all over again. Her heart was set on this property and mentally, she had already moved in. I am truly happy for the efforts that BofA made to make this sale a reality. There was a mishap in the beginning, however, we finished strong. Thank you Bank of America, you have done it again!

Short Sales, Shorter Process

 

 

The short-sale process is expected to get shorter starting June 15. New guidelines issued under the Federal Housing Finance Agency will require Fannie Mae and Freddie Mac to give homebuyers of short sales notice of their final decision within 60 days. The new guidelines also will require the mortgage giants to respond to initial short-sale requests within 30 days of receiving an offer.

The speedier process is expected to be a boost to the housing market, Michael McHugh, president of the Empire State Mortgage Bankers Association, told the New York Times. Homebuyers and sellers often have to wait months before they receive a short sale decision from a lender. Some deals fall apart just from the wait alone.

Short sales have been increasing in recent months as many lenders find them more appealing than foreclosures, which can cost more and take longer to remove from their books.

Short sales now outpace foreclosure sales in many parts of the country. Short sales represent more than 14 percent of existing-home sales, according to CoreLogic housing data from March, the most recent month available.

McHugh says that a faster short-sale process may be particularly helpful in speeding the recovery in judicial states, where foreclosures must go through the courts before they are approved. Now short sales may be viewed by defaulting homeowners as more of an option if they want to avoid foreclosure.

“There should be a significant improvement in the turnaround,” McHugh said regarding housing markets with judicial foreclosure processes.

Source: “Speeding Up Short Sales,” The New York Times (May 24, 2012)

Short sales lose appeal among first-time buyers

A short sale occurs when a seller, sells his/her home for less than the amount owed. For example, seller A owes $100,000 for their single family home, but sells to buyer A for $50,000.  Since the home is sold for less than what the seller owed, this transaction is called a “Short Sale”. Short sale homes relieve the seller of a mortgage they could no longer afford and allow a buyer to purchase the home at a great price point. The short sale process could be cumbersome and takes a lot longer than traditional sales. The turnaround times can be anywhere from 90 days to nine months, sometimes even longer. According to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, short sale purchases for first time buyers have dropped to 39.7% of total transactions for the month of August. The survey further explains that buyers are frustrated with the approval response times, the extended time to close and the unexpected delays. Some buyers consider placing multiple offers on different homes and choses the home that wins the race to the closing table. When looking to purchase a short sale, hire a Realtor who can help you uncover all that you can about the home. 

Don't Worry, You Will Own Again.

So you gave all your might to save your home. You kept track of all the correspondences from the mortgage company and their attorneys. You completed all of the Loan Modification paperwork and emailed, faxed and even mailed a physical copy of your completed loan modification package. You waited three months for the mortgage company to finally receive your application, only to have them ask you to re-submit all of your bank statements, W2s, etc, because it’s too old to analyze.

Finally, you’re information reaches the desk of a negotiator, but it will take another couple of months for them to examine your financial information and inform you if you as to whether or not you qualified for a loan modification. A letter reaches your mail box from the mortgage company, and sadly, you were denied. Your home will be auctioned, unless you can pay everything you owe up to that point. Huh? If you couldn’t pay for one month, how do they expect you to pay all the payments that are in arrears?

Next comes the letter which states your foreclosure/auction date. You heart drops. The reality of losing your home has set it. There is absolutely nothing you can do to stop. You may even frantically, try to get an attorney involved but it’s too late, because your trusted the mortgage company you thought would come through, did not. “Why would they sell the home for so much less, when I am here, ready to keep my home” you think to yourself. “All I need is a more affordable monthly payment that would account for the recent changes in my life” (death in the family, layoff, etc.) This may be your story. Or perhaps you chose to short sale your home or agreed to sign over your deed in lieu of foreclosure.

Whatever, the situation, bottom line is you no longer own. Well I am here to tell you, there is life after losing your home. After it’s all over, you realize that life is much less stressful. No more stacks of letters from the mortgage company’s attorneys. No sleepless nights wondering where you and your family will sleep. There are plenty of rentals available in this market to choose from. You can rent for a few years and buy again. You could also choose to buy a cash home. Many folks are taking advantage of the low prices. Why not own mortgage free. Whichever route you chose, just know its going to be Okay.

Gloria Walters | Tampa REALTOR
Bridging the Gap Between Buyers and Sellers
772-359-7543 (direct)
813-200-8708 (fax)
gwalters83@gmail.com