Bank of America Wants to Control MLS Criteria for Short Sales

UPDATE:  2/13/13 - The Florida Association of Realtors said Bank of America will be issuing a "clarification email".  

The recent Bank of America agent update that was emailed out today states:

  1. Your Bank of America short sale listing must be "marketed in the MLS" as ACTIVE until an approval letter is issued
  2. How you are to fill out your MLS fields in a general manner and specific manner

Many MLS rules and even  some State laws disallow keeping short sales "active" after the seller has accepted an offer. In Florida, the Florida Association of Realtors legal department states "a short sale contract is still a contract".  In fact, my local MLS. the Emerald Coast Association of Realtors in Florida, states that even short sale properties that have "offers" (unsigned by the seller), that were sent to the short sale lender, must be removed from "active" MLS status, and placed into "pending" or "contingent" status. 


When I initially read the email I thought it was accidentally sent to short sale agents instead of REO agents. I was mistaken. I think this latest effort by Bank of America is overstepping. Certainly, there are valid points, such as, it is wise not to state a short sale is "pre-approved". But the email edict seems to also be micro-managing short sale agents and potentially is contrary to some State laws and MLS rules. The property is still owned by the seller. Third party "approval" does not equal "seller" status.


Here is the body of the email from Bank of America:

Exclusively for: | Wendy Rulnick

Forward a Friend

Short Sale Customer/Agent Care
1.866.880.1232
8 a.m. - 10 p.m., Mon. - Fri., ET
9 a.m. - 5:30 p.m., Sat., ET bankofamerica.com/shortsaleagent


Short Sale Agent Update
February 11, 2013

In our continued effort to ensure acceptable and fair marketing activity for all short sales, this is a reminder that Bank of America requires all properties to be listed on the Multiple Listing Service (MLS).

The property must have been listed prior to the acceptance of an offer. All offers must be submitted by the buyer subsequent to the listing date, and the property must be marketed on the MLS until a short sale approval letter is issued. Any property not listed on the MLS may experience processing delays, and/or the Short Sale file may be declined.

The following actions can help prevent processing delays and/or file declines.

  • List the property on the MLS and include all basic property detail, including: 
      
    • Number of beds/baths, square footage, lot size, year built, location, interior features, etc.
    • All known property information used to market the property to prospective buyers.
    • Alternative language such as "unknown" or "unavailable" should be used - instead of leaving fields blank - when you encounter certain property characteristics that may be unknown via public record (e.g., Property taxes, deed information, and other fees).  
       
  • Ensure the MLS remarks and/or comments do not reflect unacceptable language such as: 
      
    • "Do not disturb homeowner, property not available for viewing"
    • "Bank has already approved the short sale"
    • "Cash offers only"
    • "Preapproval through listing agent lender only"
       
  • Ensure the listing status is current and active on the MLS until a short sale approval letter is issued

Per investor guidelines, additional documents may be required and will be communicated, as applicable, by the Short Sale Specialist.

Views: 1057

Replies to This Discussion

Permalink Reply by Wendy Rulnick on February 12, 2013 at 2:52am

Thom - I cannot believe an MLS print-out showing "Active" etc will be required to approve a short sale.  What were they thinking?  I know they were trying to prevent FSBO short sales, but heck, even those can sometimes be at market value.  

Permalink Reply by Kevin - Greenville, SC on February 12, 2013 at 3:40am

I sent the e-mail from Bank of America and this thread to my Local MLS Boards and the Realtor Associations I am a member of.  I would encourage others to do likewise.

Permalink Reply by Wendy Rulnick on February 12, 2013 at 3:57am

Kevin - Excellent!  I also just got off the phone with Florida Association of Realtor's legal. They are contacting Bank of America, too.  I think someone just got a bit "carried away" in their email....  apparently, they missed some research.

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on February 12, 2013 at 4:56am

Wendy, I agree - this is truly foolishness and feels like an attempt by BofA to control the market, pricing, and inventory.  Quite frankly, in my market where listings are getting 30 - 100 offers mostly above asking price, it would be a waste of everyone's time to keep it Active even if our MLS rules allowed it (which it does not).  Does BofA want us to forward to them ALL of the offers as well?  I'll gladly tell a Seller not to sign any offers so we can keep it Active and send BofA all 30 - 100 offers so they can make their decision before we change the status in the MLS. Let's see, 40 offers x 20 pages - you get the math.....

In Southern CA, we typically stop taking offers after about 5 days because we can't handle the volume of offers.  If we kept it Active who knows how many "hundreds" of offers we would accumulate.  In the last 3 weeks, offers seem to be coming in 25 - 50% above recent comps which suggests they will never appraise.

When the rep from BofA instructs us on their new rules, maybe we should ask for their Broker's License # for our state, and Send them an Agency Disclosure to be signed.....

(tongue-in-cheek, of course)

 

Permalink Reply by TOP END Properties on February 11, 2013 at 4:52pm

They dictate how to fill out contracts and addendums .. how to do closings .. and now how to list a property on the MLS.

Permalink Reply by Keji Ogunleye on February 12, 2013 at 4:54am

another attempt to control.. first they want to tell agents how to market properties by requesting auctions( and some agents actually agreed with BoA and put their short sale in auction .. okay now they want to dictate MLS.. well BoA .. I don't have active pending in my MLS.. only contract with kickout.. Agents need to just let BoA know they can't do that. I'm sending the notice to my Board as well..

Permalink Reply by Kevin - Greenville, SC on February 12, 2013 at 7:37am

From Ron Ballard - 

Bank of America New Rule Requires Short Sale Listing Agents to Lie

http://bit.ly/Y71VOF

Permalink Reply by Wendy Rulnick on February 12, 2013 at 8:52am

The attorney has some well-thought out issues with the latest memo. I hadn't even thought of that. Some listings you absolutely have to have "appointment only".... and more...

Permalink Reply by Beth Larsen on February 12, 2013 at 12:24pm

Thanks Wendy and all. Interesting discussion. I think that BAC just failed to understand the implications of what they are asking in regards to the status code.

Our required status code for short sales under contract and awaiting bank approval is "Active-Cont. Remove".

I do continue to actively market the property....under the correct status code. Agents know to inquire as to status and buyers are confused by it so call anyway. I keep a notification list in case the buyer backs out.

I did pass this to our board CEO along with a link to this discussion for review. I'm sure B of A will be hearing from our industry spokes people in regards to this.

Permalink Reply by Wendy Rulnick on February 12, 2013 at 12:40pm

Beth - I am glad you passed this on to your board..... You might want to contact your state association legal division, or maybe your CEO will...  I am sure BOFA is getting many calls today from association and state legal departments.

Permalink Reply by Wendy Rulnick on February 13, 2013 at 7:50am

UPDATE 2/13/13 - Florida Association of Realtors attorney just called me. Their contact with Bank of America said there will be a clarification email sent out. I don't know when.

Permalink Reply by Wendy Rulnick on February 13, 2013 at 8:32am

Thank you, Patricia!

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