Feedback on BMO Harris Short Sales?

Has anybody closed a short sale with M & I Bank / aka now BMO Harris Bank where they forgave the deficiency amount? I see a comment in the email they sent the client with the financial paperwork forms and doc requirement lists that says this:

"*** Please note, the customer will be responsible for the deficiency balance if we agree to the short sale."

AZ has anti-deficiency statues, so not sure how they plan to get around that (language in the approval letter is my guess). Why would anybody do a SS with them if that's the case? Any feedback you could give would be most welcome.

Also they say their max commission rate is 5% - so.....anybody seen upward deviations on that?

Thanks in advance....

Replies

Deborah Y Wilson December 16, 2012 at 1:59pm
Beth Larsen December 16, 2012 at 9:56am

To all of you: as to the deficiency, have you had them put it into their correspondence as I noted in my initial message above, on those transactions where the deficiency was waived? Not sure how much of this is just strong-arm tactics.
Gary Dunham December 16, 2012 at 5:25am

As M and I has been folded into Harris Bank, you will now be operating under BMO Harris rules, number one of which is commission rate is now 5%. They needn't pay HAFA rates of 6% since they opted out of the program at the beginning and are not required to pay the 6% going rate. I am closing 1 soon and have two more in the approval process. The first has the deficiency waived, whereas the second is investment property whose decisiion will be based upon income guidelines established by Harris (meaning it will be forgiven), and the last has an offer large enough so the only deficiency is commission and closing costs, so I will try to get them to waive any deficiency under coercion of full blown bankruptcy. Harris is strict and requires many deficiency judgments, but not in cases where it doesn't work for the client financially.

Bank of Montreal is the Parent Corp of Harris, and they have little foreclosure problem in Montreal, Canada and therefore are notoriously one of the hardest banks to work with to get a deficiency waiver. Make sure your client is truly needy of this before taking it on. No voluntary cash for keys stuff here...a very conservative bank. The loss mitigation department is very professional, but stay on top of their requirements of you to do this in a timely manner. If they know you aren't performing your tasks on a timely basis, they will do the same treatment to you. Kimberly Alexander in Loss Mitigation in Chicago has been a blessing to work with.
- Beth Larsen > Gary Dunham December 16, 2012 at 9:53am
  
  Gary, thanks so much for taking the time to share your experiences. Just curious....do you ASK for your customary brokerage fee to start out with? Please see my reply to Sally and David above.
  
  I wonder how these bank reps would like it if we arbitrarily changed their negotiated salaries? Not that this is a new problem to me, I've just never had a rep state this up front on my first contact with them, pre-offer.
  - Gary Dunham > Beth Larsen December 16, 2012 at 12:38pm
    
    Beth,
    
    Actually, as everything gets folded into BMO, they will state upfront that the commission will be 5%. And yes, I did say that M and I previously paid full commish, but they are flat out saying it will be 5% from this point forward. Harris had previously only worked mainly in the Chicago area, and with their purchase of Amcore many of us weren't affected. BMO's signs are now going up over all of the M and I locations, so expect full roll out soon. It is my understanding the M and I Loss Mitigation team in Milwaukee mainly received pink slips and it is all handled from Chicago now. Many of the M and I folks are now at Johnson Bank. Asa a former Banker, Harris has a small % of problem loans, many inherited from banks they purchased. Harris is mainly a Trust Bank, not a residential lender.
Sally K. & David L. Hanson December 16, 2012 at 2:43am

We have closed a number of sales with them as both M & I and Harris...no drop in commission and no deficiency....stick to your guns...feel free to call us if we can help you.
- Beth Larsen > Sally K. & David L. Hanson December 16, 2012 at 9:48am
  
  Thanks so much for your input Sally & David. I did have a rep in Loss Mit tell me (twice) about their commission schedule, and was trying to decide if I should start out with the commission as negotiated in my listing agreement which is higher than 5%, or if that would cause delays with no benefit and possibly dispose them against my file.
  
  My general rule of thumb is to try for my customary brokerage fees, since that is after all what my listing contract says.