Bank of America Recommends Short Sale Coop and LOAN MOD At Same Time - Huh?
One of my short sale sellers in Crestview Florida, who is in the Bank of America Coop program, received a letter last week that Bank of America may modify his mortgage and reduce his principle. That is why he did not return my phone calls and emails about the written offer on his property we received on Monday-- based on the COOP program's new price. He told me today that Bank of America told him he could stay in short sale COOP and loan modification at the same time. I explained to him that I will not dedicate my business resources and waste other agent's and buyer's time if he did not want to sell his house, nor could he sign a contract, then decide to just "cancel" it because he got a modification. It's incredible to me that Bank of America would tell him to do "Both". While we all pay for it? The property has been withdrawn.
Replies to This Discussion
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Permalink Reply by Wendy Smith on
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yep. one of my sellers in Palm Harbor FL received a Fedex package encouraging him to apply for a loan modification. this file has had an approval letter since 9-11-2012, we were supposed to close 10-30-2012, BAC is reneging on approval. So maybe BAC figures since they are reneging on the short sale they'll offer the seller a loan mod?
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Permalink Reply by Wendy Rulnick on
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Wendy - That is incredible.
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Permalink Reply by Seth Russell on
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Wendy-
Sorry that you had devoted time on this AFTER BofA offered to do simultaneous Loan Mod and Short Sale...This is a contradiction that I faced last year and I was informed by BofA that as a 'company policy they will not perform both loan mod and short sale'..My client got no-where with the loan mod after 2 years effort and finally opted out and proceeded with the short sale. It sounds as though your client may have gotten misinformation from BofA-not a first. Your seller should have gotten this in writing otherwise I'd question the legitimacy of their last statement.
Wishing you good luck,
Seth
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Seth - I told my seller he would probably have to wait two months for a decision on his loan mod/principle reduction. Then I'll end up putting the house back on the market. And the buyer will be lost. They did mail him something. When he called them, they told him he could stay in the Coop program, too.
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Permalink Reply by joe beauchamp on
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Yes, they have done this to me, too. Lost a short sale because of a super loan mod - according to the seller. It was due to a justice dept thing, so I assume the super loan mod was to avoid much worse if the seller hired a lawyer to see what BofA did to her - just a guess.
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Joe - Yes, I believe it's part of the settlement.
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Permalink Reply by Ute Ferdig on
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I am glad I came across this post as I have experienced a similar trend in recent months. The lenders/servicers don't really take the fact that the seller is under contract into consideration and most sellers just want to save their home and don't care about wasting our time and resources. I don't mind helping people, but I do mind when the lenders use us as free document collectors.
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Permalink Reply by ElizabethWeintraub00697006LyonRE on
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I wonder if they are really offering this guy a loan mod or if they're just doing what they always have done which is send out packages nilly willy -- a HAFA package here, a loan modification there. There seems to be little reasoning behind the mail people receive from the bank while in the middle of a short sale. On the other hand, it could be a legitimate offer. Hard to say with Bank of America. I'm sorry this has happened to you, wasted your time and that of everybody else involved in this unfortunate situation.
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Permalink Reply by Kevin - Greenville, SC on
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That would seem to go against this - http://www.palmbeachpost.com/news/business/real-estate/banks-favor-...
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Permalink Reply by Allen Ginsberg on
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BoA is approving Short Sales and then approving Loan Modifications 7 days before Coe creating lawsuit for homeowner from buyer-
I currently have a situation where after 6 months of working on the Short Bank of American Approved the Short Sale and 7 days before we are supposed to close escrow offers the Home Owner a Loan Modification (which includes $100,000 principle reduction and 3% fixed interest rate for 30 years). This is a rental property too for the Home Owner.. Meanwhile the buyer has hired an attorney and going to sue the seller if they don't close by December 10, 2012... They buyer has waited patiently for 5 months spent money on appraisal and inspections. BoA says "A home owner can do a loan modification even after the short sale has been approved right up to the point the escrow closes.. And that the buyer is out their inspections and appraisal monies.. This is a rental property too for the Home Owner.. I know this.. If Banks are going to start doing this buyers aren't going to have confidence in doing short sales which will result in short sales selling for significantly less then market value. The buyers will wait for the property to go to Foreclosure.. Realtor s are going to back away too from short sales too if the rules are going to be “That anything goes"... This has left a bad taste with the buyer’s agent, the buyers them self and me as well.. If BoA wants to do transactions this way their paper work needs to be more transparent... Their short sale addendum should state, “The homeowner can do a loan modification right up until escrow is closed and buyer is aware that they will be out of pocket all monies spent”. Of course no one would do short sales if this was the case.
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Allen - Bank of America cannot authorize the seller to cancel a real estate contract. I absolutely don't blame the buyer. I hope this is not becoming a trend with Bank of America.
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why in the world would anyone trust Bank of America...for any reason? There are horror stories all over the Internet about BOA's business practices: approved short sales being transferred just prior to closing, written ss approval letters that are not honored, straight out lies, cover ups, dishonest dealing....good grief the list goes on and on.
the property owner in Allen's post needs to be very careful - I'd bet big money there is fine print that does not favor the homeowner.
I mentioned in a different post, I have a file that was scheduled to close Oct 30 and BOA would not approve the final HUD, reneged on the ss approval letter and yes, Fedex'd a loan mod offer to the seller just last week. Is that typical BOA incompetence or with intent?
Bank of America knows no boundaries - not even the legal ones.
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