Why offer a program and then do the bait and switch with the seller at the end?
Seller was told absolutely you qualify and this is the amount that you will receive. Now they are trying to tell seller sorry but Freddie Mac does not participate.
Freddie Mac did not send the letter and have all the meetings at the board regarding this Florida Incentive program - Bank of America did and it came on their letterhead.
Does anyone have any contacts so that I can get this deal closed with my seller getting what they were promised? This is holding up the deal from moving to closing.
I've found that although the HAFA thing is a royal pain it typically works as long as you make sure the seller meets the basic criteria prior to submission. I always make a point to request that REDC does not handle the subcontract work for my HAFA deals. That company is one of the worst.
I have done many short sales with Bank of America , some with the Florida Incentive that was offered and others where it was not. The Florida Incentive was a test program that did have great incentives but also there were requirements that the owners of the properties have to comply with. Of course it can be truly frustrating to get to the point where you are at in your transaction to have this then occur. Freddie Mac and many other investors do not participate in the Florida Incentive and yes there were many homeowner that were sent letters only to find out that the investor for their loan does not participate. The same can be said for HAFA, borrowers are made to jump through hoops, provide all the paperwork and only when it is submitted to the investor do you find out that they don't participate. This of course is very frustrating for all parties involved, the homeowner, buyer and the agents, but I honestly think that we have lost sight in this matter of short sales. While the banks are recording profits and starting to get financially healthy again, that does not obligate them to provide funds to a home owner who is in default of their mortgage. In many cases, the banks are not the true owners of these mortgages, but rather the servicers and the decision at the end of the day belongs to the servicers. A company that is in business is in business to make money and it does appear that it has become a crime for companies to make money. I know that if I were running a business, my goal would in fact be to make a profit, I don't know of anyone that would set out to have a loss.
I do believe that you can go through the process and work to have your file escalated, to get to the bottom of what has occured on your particular file. I have found that remaining as calm as possible during these tougher files gets me a lot farther than ranting and raving. I focus on the hardship that my seller is going through and how strong the buiyer's offer is, and how quickly this can all be resolved. I do send my messages through Equator and follow up with phone calls. Most of the employees working on these files have the misfortune of dealing with irate people all the time, so if you approach it in a calm, firm and respectful manner they do tend to work with you more.
In theory, I agree with what you have said about remaining calm, providing the facts and asking for a file to be escalated.
On the other hand, the banks were never truly unhealthy. Hank Paulson and crew paired up the floundering financial sector with banks solvent enough to carry them through the crisis. I do not care how much money they make or lose -- I cannot see a quarter in recent history where they have not made enormous profits. The banks can be criticized in spite of the truth that by their fundamental nature they are doing business as they have been constructed -- solely for profit. At the expense of a devalued group of their customers, banks such as Chase and BoA opt to spend money on yet another predatory corporate tool. They can be faulted for making an disingenuous offer of relief. They dangle incentives near struggling homeowners via mailings and other advertising then the bank forces everyone jump through hoops to get the money.
Yes, every business needs to make money but consider that the banks made money on the initiation of the loan and the interest on the loan. If the owner is upside down and has been paying their mortgage, the banks would easily have made a profit with the interest earned. Also, as other have mentioned, BoA received government bailout money that was not used as it was intended.
For the banks, making money is wonderful, providing good service to consumers is expensive and when push come to shove, corporations exists only to make money through profit. They are not governed by social responsibility or any inherent ethical bent that compels them toward treating their customers honestly and fairly. The only ones that can do this are the bank employees who are living and breathing human beings, some with a sense of social justice in their hearts....
Once a consumer has a mortgage, they are at the mercy of an entity whose sole goal is to make profits. Arguing on behalf of the banks is unnecessary as they will survive and thrive at all costs. Fighting for several thousand dollars for a human being or family is a goal worth pursuing from my perspective.
Chase sent out similar letters and there was a lawsuit and they are now honoring those letters, after the fact, due to these lawsuits. We have personally completed a couple of these Chase deals. I imagine it is only a matter of time before Bank of America follows suit.
So far, we have closed 5 transactions with the Florida Incentive ranging from $7,711 to $11,797. And we have several others that should be closing soon with incentives $15k+. The calculation for determining the incentive is 5% of the principal balance as of August 31, 2012. One of the biggest issues we've run into is that most of our files are being handled by BOAs 3rd Party Vendors and there has been extreme mis-communication between BOA and their vendors on how the incentive should be handled.
Fortunately, we were recently granted access to the agent escalation tool in Equator. In a specific instance where we were told that the seller didn't qualify by one of the 3rd Party Vendors, I escalated the file with this tool and was assigned to someone who specifically handles escalations only. They were able to look into it and communicate to the 3rd party vendor that the seller did in fact qualify.
Just last week I was speaking with a manager within the escalations team regarding the Florida Incentive. I was told that as long as the file was initiated during the eligibility timeline and closed by August 31, 2012 that the borrower would be eligible (as long as it isn't VA, FHA, USDA). If you called and were told that the seller did qualify and were provided a specific dollar amount that they were eligible for, most likely they are eligible. In regards to the net proceeds, the Florida Incentive DOES NOT go into the calculation of the acceptable minimum net proceeds. Therefore if the offer meets the minimum net without the incentive, the offer should be approved. This is another issue that we have run into and escalated for clarification on.
Out of the 12 files that I have that qualify for the incentive, only one was actually solicited for the incentive. Out of the 5 that I have closed, none were solicited. It is extremely frustrating that there has been so much mis-communication on this issue, but I go to bat for my sellers and each and every time have been successful on getting the incentive. Just keep escalating.
The co-op letters and agreements that the borrowers sign have "may" in it. Whenever you see "may" it becomes contingent on whatever BofA chooses to make it contingent on. The "agreement" allows the borrower to enroll in the program and "if" they successfully close the co-op short sale then they qualify for the incentive money.The language they use is very ambiguous for a reason.
I have been reading the remarks and also doing some research into things of this nature. It seems the govt have given the banks a great deal of taxpayer money to use for this program and others like it. It appears that many of the banks are trying to keep the money. I recently read that only about 3% of these funds have been used for this purpose, so it seems as though our greedy little friends at the banks are still doing what they do best. Bilking the general public out of more money...
Not the answer you want but a warning for the future. Bank of America is an admitted felon. OK? Then add the fact that they are unorganized and bloated beyond belief. The best way to deal with them is to always copy the authority that regulates them in your state. Or the new Consumer Protection Agency...whatever they are called now.
Brian Tutas was right. I have had two deals recently, one where $17,000 was paid to the owner, and another one was over $13,000, and this person was not an owner occupant, it was a vacation rental. This was the amount offered by BOA, I didn't ask for it. The only reason I can come up with is that I got offers in both cases much higher than what they wanted. The way to do that, is to get the BPO low, and to offer the property higher than what the bank is expecting. In both these cases, the bank did not come up with their list price until AFTER I got a much higher offer. Of course, you can't submit that offer until the bank has done their work, including a list price. Another deal where someone was qualified, the incentive was denied. That deal the offer was lower than their list price. So it stands to reason that the bank's net in relation to the value they have placed on the property has everything to do with whether the seller get's the incentive or not. Of course, that may not be the reason the bank gives, but it is reasonable. You can try and get the bank to reverse their decision, but I have been un-sucessful.
It just happened to me on a Bank of America Fannie Mae Cooperative Sale. Incentive withdrawn as Owner never occupied.
The coop letter does not say may. If you read the most recent coop letters state that "Bank of America, N.A. will pay you$____" Chase has had issues with this and they are going back retroactively on their current short sales and giving incentives to sellers. Sounds like an attorney got aggressive to me.