BofA FHA Short Sale Help
Full disclosure: I am the buyer in this situation.
I have been in contract for a BofA FHA SS since late August and I have yet to hear approval/anything substantial from the bank. I realize as the buyer I have zero power (is it possible to have a negative number of power, as it feels as though that's what I have?) in this situation, nor can I contact the bank, HUD, etc. regarding the sale. I do have a question or two that I can hopefully get specific, pointed answers for. Here goes.
1) The listing agent (as well as my agent and myself) have heard/read that negligence on the bank/negotiators side can sometimes be "corrected" by contacting HUD and explaining the situation, which causes them to contact the bank. The problem is none of us could find a way to contact HUD (the only number we found the person from HUD simply told us to contact BofA, which we know doesn't work very well). The sale is taking place in Minneapolis, MN. Is there any number(s) the Listing Agent can call for HUD to help aid this process along?
2) We were recently assigned a new negotiator with BofA (we don't know why...the other one never contacted the LA or returned emails or calls). Is there anything the LA can do to "expedite" the process this time around?
3) I personally tried contacting the @BofA_Help Twitter account, to which someone actually replied. I disclosed I was the buyer, and that I realize they can't tell me anything, but I asked if they would contact the LA for more information. They said the only way they can do that is if the LA contacted them via Twitter such as I did. I expected this. I forwarded the information to my agent, who then forwarded it to the LA, who then responded by saying essentially that she was not going to try that, even though I actually did get a real-live human on the phone. How should I deal with this?
Sorry for the barrage of questions, I'm just frustrated. We all are, actually. I just want to make sure everyone's doing everything they can to make this happen, as no one wins if it doesn't.
Replies to This Discussion
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Permalink Reply by Jeffrey Burnham on
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Your situation is not uncommon. B of A is herendous to work with. I have one that is now going on 2 years... so far my record is 26 months with B of A.
SO..... you need to be prepared to wait. I try as much as possible to get myshort sales PRE-APPROVED, like using the HAFA program when possible. My first question to the LISTING agent (YOUR agent should contact the LISTING agent) is: HAVE THEY/SELLER SUBMITTED ALL REQUIRED DOCUMENTATION? Second question: has a BPO (Broker's Price Opinion) been done to establish whether your offer is in line with the actual value of the house? Third question: Has all this been submitted to the actual INVESTOR on the Seller's loan?
B of A often bobbles the paperwork... waits months to handle things, plays "musical negotiaotors" (switching them multiple times) and then requests UPDATED info because what they have is months old! I have my SELLERS in short sales update me monthly with new paystubs/ bank statements to avoid this which I upload into B of A's equator system (their computer system for handling short sales.)
UNLESS you are either prepared to wait... 8-9 months is not unusual with B of A, I might suggest a "PLAN B" (another home.) YOu should look to YOUR agent to fully explain the short sale process and they/you should INSIST on updates from the listing agent every 10 days. ( I ALWAYS do that with the Buyer's agent/ my Buyers to manage expectations.) Biggest thing to understand is that YOU are not going to get any direct answers from B of A due to privacy laws. Same goes for YOUR agent. You should, however, use your agent to always keep you abreast and hold the listing agent to task if it seems they're not doing the job.
Remember, not ALL agents know how to do short sales. Just like not all doctors can do a heart transplant. Look to YOUR agent for guidance. You have to be confident in THEM (your agent.)
Good luck and try to not stress too much over it. The more anxious you are, the slower B of A will move.... that's Mr. Murphy hard at work!
Oh yeah, one more thing....unless you feel (and can PROVE) that you've been discriminated against....HUD has absolutely NOTHING to do with B of A's handling of a short sale!!! They have NO jurisdication over things... and ultimately the short sale CAN be declined even if your offer makes sense financially. The bank/ investor is under NO OBLIGATION to accept anything less than 100% what is due to them!
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Permalink Reply by Nathan Miller on
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When HUD is insuring the loan, as they do with all FHA loans, you better believe HUD has something to do with the servicers handling of a short sale and has jurisdiction over short sale matters.
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Permalink Reply by Katie Mitchell on
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Jeffrey,
It seems you are unfamiliar with FHA Short Sales and their procedures--educate yourself, it will make dealing with FHA Short Sales with any bank easier.
Like Nathan says and I mentioned in my previous remarks HUD has everything to do with a FHA short sale being approved. I have attached HUD's Preforeclosure Sales Program Guidelines. You can find more information on www.HUD.gov.
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HUD PFS Program Info.pdf, 78 KB
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On the contrary, I am QUITE familiar. And have closed many. Please note the word GUIDELINE.
I challenge ANY AGENT ANYWHERE IN THE U.S. to show that B of A has acted within the SUGGESTED scheduled timelines for doing shortsales. These are merely SUGGESTIONS for proceedures. They are not mandates. And actually accepting a short sale is totally optional.
I would additionally like you to show me where HUD has the authority to make a bank act when these guidelines are not followed. IF we lived in a perfect world, the banks would act fairly and do what makes sense. If that were the case, so many of the Attorney Generals in so many different states would NOT be suing B of A. Please note, those are States... NOT HUD. If you can pinpoint any action but HUD against B of A in relation to a short sale, I'd be quite interested.
In keeping this professional, I would suggest it's unfortunately how you interact with the players involved at the Bank. I've worked with some good ones, unfortuately.. I've worked with many who are much less than motivated.
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I did some additional research here... it looks like HUD WILL have authority to review the banks implementation of proceedures. (On FHA loans.) I would stand by my assertion that, in my experience, I've NEVER seen B of A live up to the guidelines for timeframes.
I still say it's WHO you talk to at the bank. DIfferent results with different employees.
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Yes, I am only referring to BOA FHA Short Sales (their conventional short sales are another story).
Their FHA Short Sale Department is quite responsive, does follow the guidelines and are quite helpful. I personally submit a full short sale package to the department PRIOR to bring the house on the market officially. If my package (minus the HUD and Offer) meets the terms of the program, they have typically responded to me in 2-10 days. The quickest they have done the appraisal and accepted my seller into the program even before an offer is 10 days. I have closed 5 of theirs in the past 12 months with ATP all within 2 weeks and after an acceptable offer comes in they all close smoothly within 30 days.
If any bank is not following the PFS Program guidelines be sure to call the HUD hotline number that I mentioned and get a ticket number...it works every time!
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Thanks a ton. This is is potentially very useful information. I'll be contacting my Agent very shortly and passing this along.
Thanks!
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Jesse- I thought of something else I tried. But please keep in mind I'm a buyer like yourself so I dont have experience with short sales other than my own. But I forgot to mention that my dear, old Dad, who seems more excited about my first home than anyone, contacted our local Congressman to file a complaint about the slow short sale process. It took about 2 weeks, but his office did return our call with a contact for our area and said they could help put pressure on the bank (?). But they also said the sellers would have to call and file a complaint. I passed the information on to the LA but I don't know if the sellers ever tried to call. I was surprised to even get a response from their office, so maybe you could get a contact for your area the same way.
Quick update on mine - found out te appraisal was finally done on Tuesday and I should hear something next week. SURE I will. I've given up on having any expectations!
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877-622-8525 - The listing agent may create a ticket with HUD for assistance with the difficult servicer.
The better advice would be... Go buy a property that doesn't involve dealing with Bank Of America.
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Permalink Reply by Jim West on
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Jesse, you can try this website www.ots.treas.gov. I am sure the seller will have to file the complaint on this site, since it is their loan, but at least you can pass it along to the LA and see if they won't help support the activity. Also the seller can try to issue a QWR to the bank. Especially B of A, who was caught up in the Robo-signing suit. Sometimes issuing a QWR freaks out the banks enough that the managers get involved and push the file forward. The seller is the only one who can issue a QWR. Good luck with your pursuit.
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Permalink Reply by Tamara Dorris on
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I have had a few success in getting files escalated via twitter.
At the risk of sounding dumb, can someone please explain to me why there is such a big difference in FHA short sales vs conventional? Does it have to do with investors? And why doesn't Equator handle them?
Thanks!
Tamara
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