Replies to This Discussion

Permalink Reply by James ferebee jr on January 25, 2011 at 12:34pm

If the HOA can't foreclose on the property for HOA fees then BAC is not paying them.

I found out when I sent the closing HUD in to be approved..

Nice time to tell me after the rep had already agreed to pay them.

Lucky for me I was able to negotiate them down and get a release so the agents could get it closed...

 

Jim Ferebee

Permalink Reply by Dianne Slutsky on January 25, 2011 at 12:49pm

Unfortunately, it is BofA's policy not to pay delinquent HOA fees.  I always warn my sellers to keep those fees current.  You can ask the Buyer to pay the fees.  Also, I have had two BofA short sales where I finally got the supervisor to allow the past due fees (both in CA), so you can try and escalate and show the true hardship of the Seller who has no funds to contribute or pay past due HOA fees.  Good luck!

Permalink Reply by Cheryl Bray on January 25, 2011 at 12:56pm

You pretty much guessed right.  It likely is due to the particular investor on this loan.  Bank of America services about 200 investors, all with different short sale requirements.  We as agents need to educate our clients that just because BofA approved or didn't approve something on one short sale, it has little bearing on the outcome of the current short sale, unless you know for sure it's the same investor.  You can try escalating to a manager.  You can also negotiate with the HOA management company and see if you can get the amount reduced.  If it goes to foreclosure, that doesn't benefit them or that HOA community.  You do have some leverage.  I always ask my sellers to stay current on HOA's for this very reason (i realize you probably didn't get the chance to have that conversation). Good luck

Permalink Reply by Lori Young on January 25, 2011 at 1:18pm

On the seller contribution I submit as zero and end up with zero.  You can not allow them to ask your seller who has $500 to make a contribution.  Just update the hardship letter specifically addressing this issue alone, sign and date it.  Upload to Equator and ask the rep to show the letter to the investor.  Chances are that the investor did not ask for the contribution but BOA asked on their behalf.

As far as HOA's, get an invoice from the HOA and upload that to Equator.  Email the rep and copy the team lead with the invoice attached to the online email via Equator.  If you don't push the issue you will not get it approved.

Look at it this way - Bank of America is going to push you as hard as possible.  If you allow them to place demands on you then that is what happens.  You have to present you side and protect your seller.  Good luck, open mouths get fed.

Permalink Reply by Tracey Martin on January 25, 2011 at 4:19pm

You may want to check with the HOA to see if they will release the lien without releasing the obligation. They can do that. Essentially it allows the property to be sold, but the sellers are still on the hook for the past due fees.  As it is the lien is worthless because there is no equity in the property. If a foreclosure occurs, the HOA  may get not get anything at all. If they release the lien, at least they will get some one in the property who will pay the dues from the time they move in, so they won't lose any more money on that unit. Of course your sellers will have to agree to the above. If that doesn't work you can try to get the HOA to settle for less than is owed to them. Good Luck

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on January 25, 2011 at 4:40pm

Scott -

 

A couple of things;

1) BofA no longer pays HOA delinquencies, Transfer fees, Doc fees, etc.

2) If the seller owes the HOA $6,000 - it is very likely the HOA has also filed a lien against the property.  It is also very UNlikely they will release without payment.  Why should they?  The HOA delinquency remains with the property - even a new owner will be tagged with the delinquency.

 

I have a transaction right now with BofA, the seller owes $20,000 in past due HOA fees, the HOA has a lien on the property.  When BofA declined to pay the past due HOA (and past due RE Taxes), the buyer reduced the price by $20,000 because the BUYER will pay the HOA through escrow.  BofA approved it yesterday.

 

I suggest two things;

A) Ask the Buyer if they have the $6,000 to pay to the HOA.  If they do, reduce the price by $6,000 and let the Buyer pay it through escrow and on the HUD.  Explain in Equator why the price is reduced and provide a revised HUD.

B) Have your seller write an explanation that they cannot pay anything at closing and back it up wth bank statements.  This is no time for the Seller to get creative and NOT provide ALL bank statements.  If they really have zero dollars, BofA cannot get money from a rock.  It's likely BofA will approve.

 

Best of luck,

 

Thom Colby

Broker / 3rd Party Short Sale Negotiator

Newport Beach CA

Permalink Reply by Bryant Tutas on January 26, 2011 at 1:32am

This is definitely a regional thing. I am closing on a BofA tomorrow and they are paying 2,000 in HOA fees. 2 years worth including attorney fees. So they WILL pay them. But as James pointed out it depends on the HOAs ability to foreclose or not.

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on January 26, 2011 at 4:10am

Hi Bryant -  In CA, the HOA can foreclose and actually does (then they realize they are subject to all superior liens and wish they hadn't, but that's another story).  Maybe it's that BofA will not pay the "larger" HOA amounts.  Here in CA, it's not unusual for the HOA fee to be several hundred bucks a month and it adds up pretty quickly.  So maybe BofA will pay a couple of thousand dollars but not $10,000 or $20,000 (or more in some cases) - not sure.  This is another piece of the puzzle I guess we're all trying to fugure out definitively.

 

As I always say, if you don't ask for it to be paid, the bank doesn't have the opportuntiy to step up or to decline the request - so always "ask".

 

Best,
Thom Colby

Broker / 3rd Party Negotiator

Newport Beach CA

Bryant Tutas said:

This is definitely a regional thing. I am closing on a BofA tomorrow and they are paying 2,000 in HOA fees. 2 years worth including attorney fees. So they WILL pay them. But as James pointed out it depends on the HOAs ability to foreclose or not.

Permalink Reply by Bryant Tutas on January 26, 2011 at 6:17am

Thom. I would guess it depends on the investor and the particular deal. If the purchase price is high enough you can get just about anything paid. Always ask and push the issue. But you knew that :)

Thom Colby said:

Hi Bryant -  In CA, the HOA can foreclose and actually does (then they realize they are subject to all superior liens and wish they hadn't, but that's another story).  Maybe it's that BofA will not pay the "larger" HOA amounts.  Here in CA, it's not unusual for the HOA fee to be several hundred bucks a month and it adds up pretty quickly.  So maybe BofA will pay a couple of thousand dollars but not $10,000 or $20,000 (or more in some cases) - not sure.  This is another piece of the puzzle I guess we're all trying to fugure out definitively.

 

As I always say, if you don't ask for it to be paid, the bank doesn't have the opportuntiy to step up or to decline the request - so always "ask".

 

Best,
Thom Colby

Broker / 3rd Party Negotiator

Newport Beach CA

Bryant Tutas said:

This is definitely a regional thing. I am closing on a BofA tomorrow and they are paying 2,000 in HOA fees. 2 years worth including attorney fees. So they WILL pay them. But as James pointed out it depends on the HOAs ability to foreclose or not.

Permalink Reply by Jeff Payne on January 26, 2011 at 7:01am

Diane, it totally depends on the investor,  I have always been able to get BofA to pay delinquent fees, had one recently that they agreed to $18,000 in delinquent fees....

Dianne Slutsky said:

Unfortunately, it is BofA's policy not to pay delinquent HOA fees.  I always warn my sellers to keep those fees current.  You can ask the Buyer to pay the fees.  Also, I have had two BofA short sales where I finally got the supervisor to allow the past due fees (both in CA), so you can try and escalate and show the true hardship of the Seller who has no funds to contribute or pay past due HOA fees.  Good luck!

Permalink Reply by Jeff Payne on January 26, 2011 at 7:02am

Thom, I closed one recently that BofA agreed to pay $18,000, it ended up being less at about $14,000 but they paid it on a condo.  Never say never :)

Thom Colby said:

Hi Bryant -  In CA, the HOA can foreclose and actually does (then they realize they are subject to all superior liens and wish they hadn't, but that's another story).  Maybe it's that BofA will not pay the "larger" HOA amounts.  Here in CA, it's not unusual for the HOA fee to be several hundred bucks a month and it adds up pretty quickly.  So maybe BofA will pay a couple of thousand dollars but not $10,000 or $20,000 (or more in some cases) - not sure.  This is another piece of the puzzle I guess we're all trying to fugure out definitively.

 

As I always say, if you don't ask for it to be paid, the bank doesn't have the opportuntiy to step up or to decline the request - so always "ask".

 

Best,
Thom Colby

Broker / 3rd Party Negotiator

Newport Beach CA

Bryant Tutas said:

This is definitely a regional thing. I am closing on a BofA tomorrow and they are paying 2,000 in HOA fees. 2 years worth including attorney fees. So they WILL pay them. But as James pointed out it depends on the HOAs ability to foreclose or not.

Permalink Reply by Jeff Payne on January 26, 2011 at 7:07am

On November 4, 2010, I closed a BofA short sale, sales price was $127,000 and BofA paid 14351.95 for past HOA fees.... In Florida...

December 15, 2010, BofA paid $7627.25 in past HOA fees on a sales price of $147750.00

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