Replies to This Discussion

Permalink Reply by Evelyn Broxterman on May 7, 2013 at 11:21am

I meant why does she needs docs from BOTH entities.

Permalink Reply by ElizabethWeintraub00697006LyonRE on May 7, 2013 at 12:49pm

Probably because anybody can sign a letter, even the buyer can sign a letter to himself -- which I saw in one of my short sales the other day and we rejected it based on that. Swear to god. The corporate letterhead shared the address to whom the letter of credit was addressed, which was his home address. The guy could not provide POF in his name and refused to take title in the corporate name, so he didn't get the house.

Bank of America has its guidelines, and they want the Articles, operating agreements, because they want to prove the person who signed the contract has authority to purchase the property and is the entity the organization declares itself to be.

Permalink Reply by Pattilynn Guilford on May 7, 2013 at 1:45pm

Articles of Incorporation are always required .. not sure about the Operating Agreement - that's usually not public info - however, it does seem lately that banks are requiring both the A of I and OA.

Permalink Reply by joe beauchamp on May 7, 2013 at 1:56pm

Unfortunately, BofA and WF go for the cheapest bottom people to deal with short sales by breaking the job into tiny parts. So you deal with people who have their list of rules from their manager and have no care or clue of the other 10 pages of the document. So, you run into really stupid stuff that somehow makes sense to them but not anyone who has a concept of completing a sale. For instance, BofA created a form for FHA with a question "how is the property being maintained?" Clearly, this is for vacant or rented properties but it doesn't say so. I had a seller say "everything" like anyone living in a property with an IQ above 60 might say. Not good enough. Had to put in things like mow the lawn, shovel the walk and on and on. How does that make any sense? Dumb form, dumber "specialist". That would not have happened 3 years ago because you'd be talking to a negotiator and not a "specialist".

The corp/LLC docs are needed to show no conflict - that it isn't a shell for people related to the seller, etc.

The POF is dumb. I have banks baulking for weeks for just the right thing when they could just approve the stupid sale and let it close. If the buyer doesn't have the money, it won't close. Faster than their screwing around with per-approvals (not worth the paper that they are on, of course) or POF's. But, another hoop for the bank to drag out short sales.  They want the POF on letterhead or bank statements. Stay away from foreign currency or stock - the bank may claim the stock is not liquid and complain that they don't know what $50MM Euros will be worth when you want to close a $125K property. (And just exactly what is this buyer getting away with by faking funds to close? Maybe wasting as much time and resource as all this screwing around for POF/pre-app if he can't close?)
I'm guessing this is FHA since you get the luck of the draw when you resubmit in Equator for the others, unless BofA has recently made a change there. I've run into some real useless people who don't respond to complaints to their managers, escalations, twitter and even HUD - multiple times. I find this incredibly incompetent management - unexplainable but currently the situation.  How does a "document reader" get away with thumbing her nose at all these levels of management/investor repeatedly? Otherwise, that was a good strategy to get out of the kiddy pool and get to someone else to work on the sale.

Permalink Reply by michael bellamy on May 7, 2013 at 3:58pm

I must have the same negotiator.  Today my  Bank of America negotiator rejected my POF. The reason being that I indicated in the offer it was a "cash" sale, and the POF indicates that the funds are coming from a Bank of America line of credit. She wants me to change it to a financed offer, and get a credit letter of approval.

Permalink Reply by Becky Alfaro on May 8, 2013 at 4:19am

Evelyn in my experience BofA always asks for one or the other of these documents. In my state all we have is a certificate of formation and that has been enough for them on my short sales. It is interesting that none of the other short sales that I have done, other than maybe one with Wells Fargo have ever asked for that. If the individual is not a business though then they should not need those docs as long as the contract does not include an LLC in the purchaser portion.