Replies to This Discussion

Permalink Reply by Paul Francis - Vegas Short Sales on September 8, 2010 at 6:00pm

Interesting to say the least...

Permalink Reply by Alan Remigio on September 8, 2010 at 7:44pm

With all due respect...great humor for the day! This program cannot be a broad stroke of the brush unless a lot of compromises are reached with MI companies, GSEs and MBS programs.

I can see this program having a very narrow window of opportunity due to the contractual obligations regarding guarantees and recourse by the above mentioned group. It sets a dangerous contractual precedent, since "being upside down" seems to be the only qualifying requirement. We know valuation is a subjective process which adds to the difficulty of administering such a program.

In addition to the lender side challenges, we also have individual state challenges that protect the homeowner, which vary state to state.

I'm all for streamlining and please understand, I'm not raining on the concept, but, I don't see this happening quickly and of the scope needed to be effective and profitable for the lender for quite a while.

Permalink Reply by Wendy Smith on September 9, 2010 at 12:07am

Good grief - that reminds of something I heard last week ...I heard Bank of America was rolling out a program specifically designed for Section 8 tenants to become homeowners (straight from the lips of a BoA VP) BoA will subsidize the mortgage payments for 15 years - yep, 15 years, that's what she said. The tenant-to-be-homeowner will have to have steady employment for one year.

So is this what they're going to do with all those failed short sales? put scetion 8 homeowners in them? they would probably get some type of tax-payer funds for the program (think spread the wealth)

Someone is going to have to start a "snopes" exclusively for Bank of America rumors...

Permalink Reply by Ryan Diedrich on September 9, 2010 at 6:01am

I call your bullshit. No way they will let this fly. Everyone in Las Vegas with a BofA loan will just sell and leave....even if they make $200,000 a year, they can jut pick up and leave??

Permalink Reply by AMY GERRISH on September 9, 2010 at 8:15am

Ryan: LOL - I'm just as jaded towards them as you are. BofA is a huge headache in my book when I'm helping clients process short sales. But, just passing along the info, so don't shoot the messenger =) The equator system was supposed to be a huge help, that was a major disapointment as well.

Wendy - we should submit this to SNOPES. Great Idea!!

Permalink Reply by AMY GERRISH on September 9, 2010 at 8:25am

Ok, got a little bit more info from comments on the Harris blog - remember it's 3rd party info so take it with a grain of salt, or a 1/2 a grain lol.

From Shirley D: I called BofA today to inquire about this information. Upon inquiring, I was told that I need to be transferred to a “Specialized Team” that handles this program but after waiting 10 minutes on the phone, I was told to call back in 2-4 hours because nobody is available to speak to me. The only thing I was able to confirm is that HPO stands for High Performance Outreach program. There is no direct number that you can call. You have to call the short sale department and all they can do is internally transfer to you this so called Specialized Team.

Also, in reply to Alan - I think this is for people who are denied loan mods and don't qualify for the GSE's or fha short sale programs because they don't have their loans with them, at least that's what was deducted on their blog "teleconference" with the agent that was used for trial HPO file.

Permalink Reply by Wendy Smith on September 9, 2010 at 8:47am

Ryan...bull what?

Permalink Reply by Karyl Moore on September 9, 2010 at 9:43am

I got the note below from B of A today. It says it's part of a pilot program but doesn't say anything about 'HPO.' It came with an attachment which I will try to attach here. It lists the steps to take and how to use Equator, etc. It still shows all the same things we need to submit: bank statements, etc. Shortly after the e-mail, I did get a phone call from B of A asking if I needed any help and if I'd used Equator before. So maybe they are trying something new but I don't think it offers all the nifty features the Harris blog stated. I'll let you know if I learn anything new. Here's the note:

Short Sale Welcome Call

Thank you for initiating a short sale with Bank of America. Our welcome team will be attempting to contact you within the next two business days. This team is committed to preparing you for the short sale process and answering any questions you may have. Enclosed is an overview of the process including key information to successfully complete a short sale. This information will be discussed during the welcome call, as well.

Please be aware that the welcome call you will receive is part of a pilot program that will reach only a small number of agents who have initiated short sales. Due to the small size of this pilot program, it is very likely that you will not receive a call on future initiations.

Following the welcome call, please direct all communications to your short sale specialist through the Equator messaging system, or to our Customer Care specialists who can be reached by calling 1.866.880.1232. Again, thank you for initiating a short sale with Bank of America.

Attachments:

• Quick Reference for Agents.pdf, 524 KB

Permalink Reply by Joyce Freese on September 11, 2010 at 7:42am

This can't happen fast enough!!

Permalink Reply by Michael Schneider on September 12, 2010 at 2:41am

HPO.....?

As Alan is saying, any such program, initiated by the Servicer, could only apply to loans on portfolio of that Servicer, I think.

Meaning, BofA can only set the guidelines for loans owned by BofA.

So, I'm thinking that if HPO is real, then it would apply to a limited set of on-portfolio loans, eg CW loans, in an entity owned by BofA or CRA loans on portfolio. Probably a small percentage of total.

Here is a principle: All announced short-sale programs or principal reduction programs will have much less impact than anticipated. (HAFA, H4H, FHA neg-equity refi)

And the reason is pretty clear, I think, namely nationwide there is $700B in underwater principal balance. Nobody is going to pay for this, so eventually the Investor will need to lose the money. No other way out, I think.

Permalink Reply by Alan Remigio on September 12, 2010 at 4:20am

There are quite a few people who are denied loan mods because their financial makeup IS asset heavy. Due to circumstance they still cannot make their complete mortgage payments and/or upon advice from their accounting and legal team, choose to short sale. Smart fiscal management on the homeowners part becomes a strategic default to the lenders, who now look down on that action.

Which brings me back to the purpose of HPO. With the generous proposed guidelines revealed in this discussion the only opportunity comes from bank owned notes and, eventually, select investor owned. That is a very smalll window and usually a "high end" bank customer is involved, as a business line of credit or other commercial contracts may tie up these personal assets making it somewhat less desirable on the open market. I suspect this is an attempt at compromising on strategic defaults. I may be wrong, but, HPO (High Performance Outreach) does sound like what it is...giving the high end client a way out. It does make sense for a bank client with good assets to shed property valued as"underwater" and redirect that capital to another source. The bank may be providing that out.

I suspect, through the banks management reports, they have identified these people and will be marketing directly to them, much like the mailouts they have done for others in pre-foreclosure. The good thing is they will probably be directed to use a realtor of their own choice, or one the bank is familiar with (most likely), and give the realtor the marketing material so a process could be followed. We'll just have to see.

This is a great site to constantly analyze what a particular lender/servicer is doing and taking and running with the solutions and opinions offered. Good stuff and great professionals here!

Permalink Reply by Paul Francis - Vegas Short Sales on October 4, 2010 at 5:58pm

Reading over the details from the original post by HREU, it appears to be similar to another Program with another lender where properties they want off of the books have already been identified. (Portfolio loans.)

I have one with the other lender under this program, met the Regional Asset Manager at the property for review, the seller was asked some simple questions and walaa... done. When we get a buyer on the property we have a 45 day closing and they are giving the seller $5K at closing and waiving any future deficiency rights.

Once again... Portfolio loans that they are very motivated to get off of the books...