Blog

Short Sale, Bank of America and the Squeaky Wheel

When I was a child I always heard "The squeaky wheel gets the grease" and today..I was the Squeaky Wheel. I have been working on a Short sale since November 16th. The sellers paid top dollar for the house $425,000 in 2005 and put $40,000 down.

In June my sellers had a 40% reduction in pay and the other was laid off. No question about the situation, it was a hardship. They needed to sell short and move on. The property had 2 Liens. Indymac was the first and Bank of America the second.

I listed the home for $350,000 no showings, 2 weeks later dropped to $325,000 4 showing, 2 weeks later Magic Number $299,950. The property had 8 showings and 2 offers in 2 days. Accepted the first one ($305,000) Sent my short sale package to both banks.

What I send to make a short sale go as smooth as one can. (I say this with humor because I do a bunch of Short sales and I have had only a few without some issues.)

□ Sellers Hardship Letter (written by Seller )
□ Authorization from Borrower/Seller
□ Financial Information Form
□ Copy of Mortgage Coupon
□ Copy HOA Coupon for each HOA (if any)
□ Copy of Paid or Delinquent Property Tax Statement
□ Copy of last 2 months Pay Stubs or Profit and Loss Statement, if you are self employed
□ Copy of last 2 months Bank Account Statements (checking, savings and stocks)
□ Copy of two years Tax Returns
□ Agent Cover Letter (the current market, the property, the sellers situation)
□ Copy of Listing Agreement
□ Copy of MLS Print Out
□ Copy of Offer
□ CMA supporting the price
□ Copy any supporting documentation for value (newspaper articles, graphs, pictures etc)
□ Copy of HUD1 prepared at offer price.
□ Any other information that will help the case.

Jan 16- IndyMac approval in 60 days...one catch, Bank of America would recieve $4,000 on the second. Not awful, but the balance was around $60,000.

Jan 16 -Bank of America...not so good...(Keep in Mind) I call every 3 Business days...No assigned negotiator, ordered a BPO (lost it), they also unable to find my authorization letter, that was sent in multiple times. Quick tip...Ask them to look in the account rolodex..and magically your name may be in there (mine was a few times.)

Sorry this is such a long story, but I want to explain why after four months of this....I made a formal complaint to the OCC and the BBB. (Squeaky Wheel)

Jan 20- Bank of America still working on it.

Feb 1- Bank of America ordered a new BPO unable to locate the first. I send an updated CMA and met the new BPO agent at the property. She did not work in the area, had no access MLS or Lock box...Really? WTH...I was nice. I emailed her all the comps, room measurements, the CMA I sent to B of A, purchase contract, etc.. everything to make her job easy! Okay, so I am not really nice but wanted her to be able to do her job and NOT hold this up!

Feb 23-Email from Bank of America...We are now sending you to Equator! OMG!! We are this close and now a New system. I complain, get NO WHERE... I upload all the 124 pages into the Equator system.....(keep in mind I faxed and snail mailed the same documents in November)

Feb 26- Bank of America more request for random stuff..they do not need...purchasers Birthday? and first 5 of SS#..I don't have this information, I represent the seller & the purchasers may not want to give this information to you, Bank of America. I get the info..put it into the system.

March- 2 Indymac sets a foreclosure date...March 17th..(they do not trust Bank of America)

March 3...Get the official Negotiator at Bank of America! Woo Hoo! I am getting somewhere...until I read her first message...I just ordered the BPO! ummm NO you have 2!

Side note...One thing I do like about Equator...you can copy the VP, SVP, Team lead, neg..a bunch at one time...I immediately remind ANYONE who reads this "You have 2 BPO's check your system, do NOT order another one" I get a note back thanking me (from negotiators boss)...Yes they do have one. That agent i sent all the stuff too...she did not use it! $348,000...WHAT, HOW, NO WAY...Not even close. I asked if they would look at an actual appraisal the purchasers had done the same day! It came in at $312,000.

March 4- Sent Bank of America the appraisal and still no where...no answers..buyers have sold their home and are going to be homeless March 15th. The purchasers are discussing a release.

March 5-10 send daily emails stating the facts to everyone in the equator system..and then I wait...call...wait...call..wait...get transferred to no one...

SQUEAKY WHEEL

MARCH 11- went to the OCC website and filed a complaint, then the BBB. Then I sent this to Bank of America!

Bank of America,

I am appalled you have made no attempt to work out this short sale. I have made a formal complaint to the OCC and BBB. The decision to DO NOTHING is NOT in the best interest of your shareholders. Bank of America had an opportunity to receive a partial payment and opted to do NOTHING and now will receive nothing. The sellers of the property have made every effort to get you the documents you requested on time. I have done everything to market the home and secure a purchaser who is willing, ready and able to buy the property. Indy Mac, the first Lien holder, accepted the purchase contract in less than 60 days and have postponed the sale date and extended deadlines. Bank of Americahas dropped the ball again. Bank of America, I will continue to fight this battle and will share my story with the media and anyone who will listen until things change. Someone must defend the distressed families going through your short sale process. They have lost too much already.

Jennifer James

It felt great to hit send! I copied all 14 people I had in my contacts with Bank of America email addresses. If nothing else I did what I needed to for my sellers and the rest of the people who Bank of America ignored. Someone needed to let Bank of America know what they were doing was WRONG!

3 minutes later - I had 3 calls from Bank of America."What happened, why are you so upset, your tone has changed?" Bank of America is almost ready to approve this you entered one field wrong. 20 minutes later I had an approval.

"The Squeaky Wheel, get's the grease" I love a challenge but this was unnecessary. Thank goodness it will be a sucessful short sale and Bank of America decided to approve the short sale.

I have 2 more B of A short sales in the process and I plan to squeak early...Thanks for reading..I am new at Blogging so let me know how I am doing...

I saw the title of the Equator group....."muddling through the process" is certainly accurate. I have an offer long overdue to get approval or a response from B of A and as always seems to be the case with B of A, they seem to want to do everything to sabotage the deal. I thought Equator was supposed to solve their internal confusion and all it seems to do is make it worse. B of A is the 2nd on this one and we have now had approval from the 1st for over a month and it's due to expire soon. I have now uploaded the payoff demand into Equator 4 times and was told by the negotiator just this week that the reason for the delay was that she still needed the payoff demand. After explaining that I've now sent it 4 times (1 directly to her email address) that "another department" uploads that file so she doesn't have access to it. How is it that I have access to it through Equator but she doesn't? Seriously?

Is there someplace on Short Sale Superstars that might give me someone to get in touch with at B of A that can actually make a decision.

This is the second go around on this same deal and it fell apart last November as my negotiator was on vacation and nobody could offer a 7 day extension in his absence. Unbelievable.....no I take that back....when dealing with Bank of America it's perfectly believable.

Hi folks. If you deal with short sales on a regular basis then you probably know by now that most of the major lenders are now requiring the transaction to be
processed through the Equator
system.

Have you had the opportunity to use Equator yet? If so what was your experience? Did it help? Was it frustrating?

Supposedly the system is designed to "reward" due diligence. In theory, agents that are on the ball and perform their tasks not only on time but completely will be "rewarded"
by having their short sale file move through the Equator system faster.

If the system truly work this way then personally I see it as a good thing as I am a very organized person. But I guess time will tell.

Anyway......here's a question for you. If you were able to ask the CEO of Equator a question what would it be?

Ask your questions in the comment section of this post and maybe.... just maybe....we'll get them answered for you.

And check out the Equator Group over at www.ShortSaleSuperStars.com

Working wonders with short sales, Janet and I have a short sale where the second lean holder wants a $25,000.00 promissory note; which the seller can’t come up with. The second has PMI which adds to the challenge. Normally a seller who elects to sell short doesn’t have the capital to make the payment and is trying to do the right thing by using the short sale option and not foreclosures. The challenge where’s the money coming from; in some cases the agents will use some of their commission to close the deal. (On a side note that 6% commission is not what it seems to be, on at $100,000 short sale, some banks reduce the commission to 5% then with the splits with the selling side and buyer side that becomes 2.5%. Don’t forget the split with the Broker now we are at 1.25% that’s $1,500 gross. Added costs EO insurance and some fees typically $350.00 total in my office and we are $1,150 and with short sale taking 60 days to close (and that a fast one) the agent doesn’t have much to contribute.) We did the unthinkable, we went to the buyer. The home is just what the buyer wants in the right location and resale in a few years could be substantial.

The buyer ponyed up and we've pulled the deal out of the morgue and are looking to close in a few days… Having an expert in you corner with the experience in short sale transactions is a must, don’t let the deal die, there is always a way to make it work.

Richard & Janet - Certified Short Sale Professional
661-733-0507 OR 733-0508
Keller Williams Realty AV Serving Palmdale, Lancaster in California
www.HomesByJR.com
www.ShortSaleByJR.com

I was listening to talk radio and was intrigued by the teaser for the next segment. "Ohio man bulldozes $350K home to avoid foreclosure".Hmmm. I REALLY wanna hear that one. I listened to the entire interviewand at the end I was perplexed. First of all, here are the details.Terry Hoskins of Clermont County found himself in a predicament withhis Moscow, Ohio home. He was facing foreclosure and was upset that thebank that held the note, River Hills Bank, would not work with him. So,to quote Mr. Hoskins, "When I knew I was going to lose it, I decided totake it down". In fact, he even advised the bank that, "I'll tear itdown before I let you take it". He went on to tell the radiointerviewer, "When I see I owe $160,000 on a home valued at $350,000,and someone decides they want to take it – no, I wasn't going to standfor that, so I took it down,"

After listening to the entire interview, I noticed that Terry Hoskins sounded like a reasonable and prudent person. He wasn'tranting, he wasn't raving. He spoke plainly with good enunciation andproper diction. He seemed to be a really nice guy. So what was hethinking?

Okay, many homeowners facing foreclosure probably feel like doing the same thing. But before you support his drastic actions, lets lookat a few more interesting facts about the story. First of all, Terryused his home as collateral for a business loan. The business wentSouth. Apparently, he wasn't a good businessman nor partner. He laterfound himself in a further predicament after his brother and formerbusiness partner sued him and won. Did you hear that? His OWN brothersued him. The property also had several liens on it filed by theInternal Revenue Service. So, Mr. Hoskins wasn't such an innocentvictim in the whole foreclosure process.

All the while during the interview, all I could think of was, "Why couldn't he have tried everything to avoid foreclosure?" In theinterview he mentioned that he owed $160,000 on the loan and the housewas worth $350,000. I'd have to leave that up to a local Realtor toverify but I figured there would be lots of Realtors out there thatwould have jumped at the chance to assist him with a possible ShortSale. Especially with all the programs the government is coming up withto assist homeowners to avoid foreclosure. And even if he couldn'tavoid foreclosure, there's a lot of families that would have loved topurchase the home from the bank.

I don't understand nor support his decision, despite the fact that I do understand the frustration that comes with foreclosure. It isobvious that he made some very poor financial deciisons and yet hedoesn't take responsibility for them. So what is your opinion in thisstory? Let me know what you think. I would like to know.

With the help that the government is providing with their short sale incentive programs, many homeowners facing foreclosure now have optionsto avoid the devastating affects of a foreclosure. And that’s good newsfor Realtors who specialize in Pre-Foreclosure options.

By the way, if you or someone you know is at risk of losing a home to foreclosure, please know that there are new options available toavoid this devastating occurrence. And know that there is someone hereyou can trust to help. As a Certified Pre-Foreclosure Specialist, Iunderstand the ins and outs of Short Sales and Loan Modifications. I amalso a Wachovia and World Bank trained Pre-Foreclosure expert and welleducated in the Government’s new H.A.F.A. and H.A.M.P. programs forhelping homeowners facing foreclosure.

CLICK HERE TO AVOID FORECLOSURE

Are you a buyer looking for a home?

CLICK HERE TO SEARCH ALL AVAILABLE HOMES

CLICK HERE TO READ WHAT OTHERS HAVE SAID ABOUT MY SERVICES!

The California Association of Realtors released their "2009-2010 SURVEY OF CALIFORNIA HOME SELLERS”. The report showed that approximately 67% of all California home sellersthat were able to sell their house in this market sold their homebecause they had an inability to meet their mortgage obligations. Inother words, they couldn't afford their house. Whether it be due to avariable rate mortgage that was resetting higher, a job loss, sicknessor just the fact that they overextended themselves, the majority ofthose homesellers basically HAD to sell.

The 67% figure includes standard sales as well as short sales. The interesting fact with this report is that the Obama administration hasonly recently begun making steps to help homeowners avoid foreclosurethru their H.A.M.P. and H.A.F.A. programs.

Other figures in the report showed that 63% of homes fell out of escrow prior to closing. Of those fall outs, 70% had buyers who couldnot get acceptable financing and 26% were due to "buyer's remorse". Ofthe homes that finally did close escrow, only 50% closed on time.Meaning 1/2 closed late!

With the help that the government is providing with their short sale incentive programs, many homeowners facing foreclosure now have optionsto avoid the devastating affects of a foreclosure. And that's goodnews for Realtors who specialize in Pre-Foreclosure options.

By the way, if you or someone you know is at risk of losing a home to foreclosure, please know that there are new options available toavoid this devastating occurrence. And know that there is someone hereyou can trust to help. As a Certified Pre-Foreclosure Specialist,I understand the ins and outs of Short Sales and Loan Modifications. Iam also a Wachovia and World Bank trained Pre-Foreclosure expert andwell educated in the Government’s new H.A.F.A. and H.A.M.P. programs for helping homeowners facing foreclosure.

CLICK HERE TO AVOID FORECLOSURE

Are you a buyer looking for a home?

CLICK HERE TO SEARCH ALL AVAILABLE HOMES

CLICK HERE TO READ WHAT OTHERS HAVE SAID ABOUT MY SERVICES!

I really hope someone can help me on this one, I had research for almost 2 years how to put a back to back closing ( ok please do not laugh) I have the seller I have the B (investor buyer) how does the investor market and list a house that is laready listed by the agent who is representing the original seller? in other words how does the B list a property as a seller to C buyer?

how does the B to C transaction takes place when doing a new listing? ( to re-sell to a higher price)

It is not an option........does the buyer need to get a Power of Attorney or a quit claim deed? to re-list a property at a higher price and flip? please help this is really important to me.

I hope I made myself cleared if not please ask me as I only have 2 days to figure out and a whole life to learn....

A to B (ok, done deal) the idea is same day flipping......

Lets talk short sale! If I have a seller who wnats to sell to a Buyer, for an X amount, then the buyer who now becomes a seller wants to resell this property and does not have to close unless the B to C transaction is complete..... my question is if you get the A to B stariaght (no closing)... how do you go about the B to C? when listing? what do you have to say? or disclose? is it necessary or just a foramlity? POA or Quit Claim Deed or just a stipulation on the contract as to othis matter? and if so will your broker let you list as the seller with no doc in hand? wneh you are representing the actual seller? (NO)

A ( listing agent ) B (selling egent) B (becomes seller, how? by means of POA or QCD? then B only sells if C buys

how is this put together?

Bank of America have made the move to an internet based short sale system modeled after there foray into the REO world. We have and are currently using the system and it seems to be an improvement at lest with adding information… One issue is supplying the buyer social security number a requirement is the first 5 numbers not the standard last 4. Coming from a computer background I surmise this was a holdover from the older design…

4. Must I give my Social Security number to private businesses?

General. You generally are not legally required to provide your Social Security number to most businesses - including most health care providers - unless one of the exceptions below applies. However, some companies might refuse to do business with you if you don’t provide your Social Security number. There is no law that prevents businesses from requesting your SSN, and there are few restrictions on what businesses can do with it.

If a business insists on knowing your SSN when you do not see a reason for it, we encourage you to speak to a manager who may be authorized to make an exception or who may know whether company policy requires it. If the company will not allow you to use an alternate number such as your driver’s license number, you may want to take your business elsewhere.

SSN required by federal law. Federal law requires private businesses to collect your SSN when (1) you are involved in a transaction in which the Internal Revenue Service requires notification,* or (2) you are engaged in a financial transaction subject to federal Customer Identification Program rules (see below “Why do financial transactions require my Social Security number?”, http://www.privacyrights.org/fs/fs10-ssn.htm#14).

I can see getting the sellers social but I can’t see it for the buyer…

Richard & Janet - Certified Short Sale Professional
661-733-0507 OR 733-0508
Keller Williams Realty AV Serving Palmdale, Lancaster in California
www.HomesByJR.com
www.ShortSaleByJR.com

If you’ve decided to Short Sale your home, you must find an agent who has the experience and credentials in today’s short sale market. Some questions to ask: How many short sales have you closed? An experienced short sale agent should have closed at least 20. Your short sale agent should know:

ü Authorization to release

ü Collect complete mortgage information

ü Able to negotiate with multiple lenders

ü Contact your lender's loss mitigation division

ü Title search

ü HOA fees (overdue balance)

ü Prepare a comprehensive short sale package for the lender

ü BPO, providing necessary comparables to submit to bank

ü Repair estimates from both seller and buyers

ü Maintain regular communication with lender and seller

A short sale is a process that can be complex and is undergoing changes as banks streamline the approvals. You need the right Short Sale listing agent working for you, it would be best to seek out short sale specialists who will fight for you and succeed...

Richard & Janet - Certified Short Sale Professional
661-733-0507 OR 733-0508
Keller Williams Realty AV Serving Palmdale, Lancaster in California
www.HomesByJR.com
www.ShortSaleByJR.com

HAFA,(Home Affordable Foreclosure Alternatives Program) will be implemented on April 5, 2010, is part of the Home Affordable Modification Program (HAMP). The new initiative aims to help homeowners who are unable to retain their home under HAMP through the use of short sales and deeds-in-lieu of foreclosures. As part of the program, incentive payments will be provided to both homeowners and servicers, but homeowners must meet certain requirements to participate.

NAR’s new resources on HAFA were created in response to the Realtors Confidence Index, which showed that buyers continue to be discouraged with the extended short sale process. As a result, foreclosures that could have been prevented often take place. NAR’s HAFA resources explain how the program aims to streamline short sales and, in the process, save more families from foreclosure.

NAR president, Vicki Cox Golder, reports that our members report that short sales are often full of "red tape," delayed and completely lost due to the complications and dealings with banks and service providers. However, we as Realtors are dedicated to helping and improving the short sale process for both buyers and sellers. I also would like to give a caution against compaines like BGS3's Program 3684 and Foreclosure.com solicting agents. These 3rd party companies get between you, your brokerage and your client. I have seen nothing except monies flowing into their coffers at the expense of the agents and brokerages where they are active. Also, I do not believe that they are licensed in all of the states that they are trying to operate in. Caution is the byword. There are alot of "wolves in sheeps clothing" out there that are more than willing to take your fees and part of your commissions.

NAR and SFR certified Realtors, are ready to help make this new program a success. The new guidelines and incentives under HAFA are a crucial step towards reducing problems with the short sale process and provide Realtors with the resources they need to navigate short sale transactions - as well as provide guidance on helpful government programs designed for homeowners facing the loss process. Keep up to date and best to you and your troubled clients.

Great Short Sale, Foreclosure Seminar.

NAR Resource to Reduce Short Sale Stress: Learn more about it:

http://www.realtor.org/RMODaily.nsf/pages/News2010021902

If you need short sale training to feel comfortable pulling off the deal, you’re not alone.

The number of foreclosures happening across the United States is unprecedented, and it’s not often that short
sales are mentioned outside of this kind of economic environment.

It’s time for you to get the expertise you need, because short sales are becoming extremely common. You don’t want to be caught feeling unsure when a client asks for one.

That’s why we offer you three different training solutions, each of them custom-made for agents just like you. These training materials take you from complete confusion to calm confidence in no time flat – and you’ll be able to turn that new knowledge into perfect closures immediately.

Short Sale Agent Training

This five-part Webinar with short sale superstars Bryant and Wendy takes you through 8 full hours of short sale training, walking you through each step of a short sale so you know exactly what to expect and how to deal with problems that may arise. Read more...

The Negotiator Interview

Bryant and Wendy interview a short sale negotiator from one of the major lenders to get you the insider secrets that make your short sale a huge success. If you want to come out ahead in a negotiation, ask the negotiator – and we did just that, so we could give you that insider info. Read more...

Short Sale Listing Package

First short sale? Use this handy listing package, and you won’t leave anything out next time. Everything from the short sale submission letter to a listing checklist, as well as anything else you'll need, all in one tidy package so you don’t have to stress. Just check it off, and close the deal. Read more...