Replies to This Discussion

Permalink Reply by Robert Boerner on June 4, 2010 at 5:11am

Has your seller already attempted a modification under the HAMP program? It is my understanding that needs to be done prior to (or concurrently with) a HAFA short sale.

Good luck with this and keep us posted as I am very interested to see how your situation plays out.

Permalink Reply by Ute Ferdig on June 4, 2010 at 5:52am

Hi Robert. Thanks for your reply. Yes, the seller tried to get a loan modification for a year without success (I was not involved in the loan mod process). They now decided that they just want to sell. I told them they had to tell B of A that they had already attempted the loan modification as I knew that the lender is supposed to consider a loan modification before they solicit the borrower for a short sale under HAFA. I wanted to make sure that B of A does not waste more time with a loan modification. My concern is that this servicer is not following the process that B of A outlines on its website for HAFA short sale. Their website specifically mentions that the second step is the Short Sale Agreement with the acceptable offer price and when Loan Resolution Corporation tells me that they are not doing that, the seller has nothing that is pre-approved and there is nothing that says we have at least the 120 days to market the property without the property going to trustee sale. I am trying to find out what other agents' experience is in that regard.

Permalink Reply by Margaret C. Taylor on June 4, 2010 at 12:42pm

I know this may sound strange but I seem to remember, from the original HAFA document that Freddie Mac is the one making sure Banks are doing what they signed up for with HAFA. You might see if you can find help there. Margaret C.

Permalink Reply by Ute Ferdig on June 29, 2010 at 10:44am

Just a quick update. While we never received a pre-approved acceptable net, I went ahead and put the property in the MLS and we accepted an offer this past Friday after 20 DOM. I uploaded everything to Equator and file was transferred to HAFA underwriting department on Monday (yesterday). We have an assigned negotiator and our interior BPO is scheduled for tomorrow morning. So far, this short sale has progressed faster than any other short sale. Don't dare to hold my breath.

Permalink Reply by Ute Ferdig on September 26, 2010 at 4:19am

Another update. After receiving the HAFA approval (not to be confused with the actual short sale approval), the file was submitted to B of A for approval, but we had to wait for the BPO value to come back. The BPO and appraisal had been done long before we had received the HAFA approval and it was a bit frustrating to have to wait for the value. Luckily, the negotiator was very responsive throughout the process and I never felt that the file had disappeared from the radar. Once the value came back, we had to wait for the ARASS letter that was mailed directly to the seller. It took some 3 weeks to arrive. The confusing thing was that Equator assigned me the task of uploading the signed ARASS well before we received it and the task became overdue while we were waiting for the ARASS letter to arrive in the mail. Although the task was long overdue by the then, it was ok once I uploaded the required ARASS documents (had to upload all required documents at once as Equator would not let me upload individual documents in the ARASS section). Then, we had to do more waiting for B of A to review the ARASS and decide whether to approve the short sale. Remember, this is a HAFA short sale, but B of A did not give me a pre-approved list price or acceptable net. They pushed this into the ARASS - back door HAFA route which does not give you the benefits of having them do the work up front and then tell you what they are willing to accept. It's very much like a traditional short sale, except that you get the benefits of HAFA in terms of no deficiency and relocation benefit (but all the HAFA timelines don't seem to apply).

Once B of A was done with its review, there was another servicer review before we received the actual approval letter. While we were waiting for the approval letter, the first trustee sale date was scheduled (the notice of trustee sale date was posted on seller's door a week after he had received the HAFA approval letter). I had asked the negotiator to ask for a postponement and B of A only postponed the trusee sale date for a little less than 3 weeks. We received the HAFA short sale approval letter on September 9, giving us till 10/23 to close (that's 45 days from the date of the short sale letter, which was September 8). Since 10/23 is a Saturday, we have to close by 10/22, meaning that we had 43 days from the day I received the short sale approval letter to closing). A few days before the new trustee sale date (9/27), I asked the asset manager if he had asked for postponement of the trustee sale date. He told me that there was none scheduled and I told him that there was (B of A never posted the new date for him, I told him what I saw on ForeclosureRadar). He said that it is supposed to be postponed automatically because it's HAFA and I told him that things don't always happen as planned. He said he would ask for the postponement. Friday evening, the sale date was still listed as 9/27, but this morning (Sunday) I saw it was postponed till 10/13. Again, the new trustee sale date is 10 days before the expiration date of the short sale approval letter. I don't understand why they keep postponing this to a date that is before the expiration date of the approval letter when there is not supposed to be a trustee sale under HAFA during the time that you have to close pursuant to the approval letter. It's unnerving to have to wait till the day before or the day of the trustee sale date to see that the sale was actually postponed. Why can't they just postpone it to a date that's after the expiration date of the approval letter?

Permalink Reply by Tom Lewenz on December 6, 2010 at 11:24am

Just wondering how this turned out? Did it close?

Permalink Reply by Ute Ferdig on December 16, 2010 at 2:05pm

Hi Tom.  Yes, it did close.  We actually closed on 10/13 and yes the trustee sale was postponed again, but about a week before the 10/13 trustee sale date I received a call from an appraiser who said he had to do a rush appraisal for the REO department.  I explained to him that we had an approved short sale that was not going to expire until 10/22 and that there was no rush because the 10/13 trustee sale was not going to happen.   Not sure why BAC was paying for a rush REO appraisal after the short sale was approved and well before the approval expired.  The negotiator could not explain it either, but he said he had no way to communicate with the REO department about this.   The appraiser ended up doing the appraisal and I felt bad because it just added to my seller's distress.  This was just another example how the right hand does not know what the left hand is doing and how they are wasting money on rush appraisals that won't do them any good.  Why not wait and see if the short sale closes by the due date and if it does not, then order a rush appraisal?  What am I thinking.  That would make sense.