Does Bank of America allow buyer contributions to 2nd liens ?

Bank of america will be receiving their NET price the investor is looking for. Now we have a 2nd lien with Green tree and they want more money to release full deficiency. Buyer may be willing to contribute.

Does anyone know if Bank of america allows buyer contributions towards 2nd's? Thank you !

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Yes and no.  It depends on who the investor is.  I THINK if you ASK them and it's Fannie, they will say no.  Fannie has an unwritten policy no one can contribute to a second lien, but if it's not Fannie backed you should be fine.

And not if you are going through HAFA. I had one with B of A (HAFA) and no one could contribute extra. Not the buyer, seller or agents.

If its HAFA buyers, sellers and agents can not contribute but the buyer can increase the purchase price by that amount netting more to the 1st and the 1st can pay the extra. We just closed a BOA 1st , GreenTree 2nd and BOA only allowed 3K to GreenTree and Greentree wante 6K to release lien and deficiency. BOA tolde me the only way to get it to go is to raise the purchase price by 3K and on the HUD change the net to the 2nd from 3K to 6K.   

Thank you everyone !

William- Are you sure Green Tree has given a full release of deficiency? if so what was the verbiage on the approval letter if  you don't mind me asking. We are offering them 10% of balanced owed (475,000) 2nd lien position and they are ONLY giving the seller release of lien and NOT deficiency, and it states in the letter for the seller to continue to make payments on the rest of the balance after short sale closing. OF COURSE, we will not sign off on such a ridiculous settlement. OR, they may review for a full release at 20% of balance. Just hit a brick wall with them and now we are taking it to Upper Management. Do you have a higher up point of contact that we can talk to at Green Tree.? Thank you for all your help!

Tabitha,  I was mistaking on my above comment. The 2nd on that deal was Mercantile. On the GreenTree deal they wanted a dollar amount to release the lien only and a larger dollar amount to release the lien and deficiency. The difference was only around $2,400. GreenTree kept changing their minds on how much they wanted to net and I would record the dollar amount they were giving me. Then during our next conversation they would deny ever saying what they said and of course I could not get them to put any thing on paper.  GreenTree did not receive the larger dollar amount on the HUD but after closing the seller called them and worked out a deal in which they took a smaller amount.

Only freddie dis allows contributions.  Put on HUD on buyer side as "contribution to"



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