I currently have a short sale with Bank of America that was approved to participate in their FHA pre-foreclosure program. Deadline is today and while I've had a number of showings on the property I have not been able to secure an offer at the suggested price given to us by Bank of America back in beginning of November.
Has anyone else had any experience with getting any type of extension with Bank of America in a similar situation or is my client now faced with the option of being foreclosed on or doing a deed in lieu?
Thanks for any help or suggestions.
**********************************
like buttons
Replies
If 3 months have passed since the last appraisal, they will order another. They will also extend that ATP at least once. I dont believe Ive ever had to go to a 3rd extension.
Thanks Minna. Appreciate the information. Good to know that another appraisal will be ordered.
You'll still have to push for one though, but they will do it. Also - if you still have that property listed at a price that isn't getting it sold, your appraisal is likely to come in too high the second time as well, so drop that price prior.
Most of the time my appraisals come in right at list or about there. Thats because I generally time them appropriately - I NEVER want an appraisal prior to list. I want my appraisals to happen when I have some established listing history and ideally am already under contract. I want to establish market value before the appraiser gets there, not hope they get it right beforehand.
9 times out of 10 you let an FHA appraiser in too early, and they'll come in way too high.
I definitely plan on dropping the price before the next appraisal is done. I learned the hard way unfortunately about having an appraiser come in too early on another short sale I had and then having to fight the appraisal before finally getting short sale approval. Thanks once again for your help.
Thanks again Justin & Kevin. I was also contacted last night by Steve from the Bank of America social media team who saw my posting and concern. I just spoke to him a couple of minutes ago and he will be forwarding the information about my client's property to the negotiator so we can move forward in continuing to market the property for sale. It's good to know that Bank of America has a team of people who are keeping an eye out for the issues and problems we come up against and reaching out to us to try and resolve them.
R. Determine whether all appropriate Loss Mitigation tools (i.e. special
forbearance, loan modification, partial claim, pre-foreclosure sale, and
deed-in-lieu) have been considered and documented, and that mortgagors
are provided every reasonable opportunity to remedy a delinquency or
default prior to the decision to foreclose.
http://www.ahacpa.org/ahacpadocs/guides/4060.1%20REV-2.pdf
Yes, generally they will grant a 30 day extension on the appraisal, which in turn extends the Approval to Participate. If you believe the appraisal was really wrong you should be able to talk to them about that as well and they'll ask you to find comps in the 6 months preceding the original appraisal.
Also, I have dropped the price in PFS to a "pre-approved" price. Since you are now in the 84% net proceeds tier, I would calculate what that offer would look like and drop it accordingly. Just be firm with buyers and let them know that is it. Even though BofA will request a copy of your MLS print-out at closing, I've never had an objection to a lower price although I knew it could come up. I hope this helps - good luck.
Thanks Justin. I'm trying to reach BofA today about it. When you say you dropped the price to a pre-approved price do you mean drop it to what the net at 84% of list price is or lower the price from what the original approved listing price from BofA was?
Just a little lower than the appraised price. I would calculate the 84% net, then add your commission, closing, title, etc. on top. The resulting price should be the bare minimum they would approve.....