" We trained hard, but it seemed that every time we were beginning to form up in teams we would be reorganized. I was to learn later in life that we tend to meet any new situation by reorganizing, and a wonderful method it can be for creating the illusion of progress while producing confusion and inefficiency." Petronius Arbiter- 210 B.C
Bank of America recently announced changes to their internal short sale system that would make the process run more effective and efficient. This has been one of many instances where changes have been made. I can appreciate the effort as short sales can be extremely time consuming and leave buyers and sellers pessimistic about the outcomes however; reorganizing their systems have created confusion for files that have been in process for months. The same issue was created when Bank of America first introduced the Equator system years ago. Files that had originally been faxed over had to be initiated in Equator therefore the turn time for a file was 9 months before Bank of America could train their staff properly and work out the kinks.
You will find the current issues the same as before. Until Bank Of America can get their teams running like a well oiled machine we will continue to have issues with files that got caught in the transition. I believe the new system will eventually be very helpful and shorten the time frames however; in the mean time we need to continue our diligence with the files and at the same time remain calm and patient. If we are calm and patient so will our clients as we are setting proper expectations with them.
Here are some details to some of the changes you need to be aware of:
1. Bank of America may require a homeowner to be delinquent 31 days before considering a short sale. This is per investor so you will not know if this is required until the file gets submitted to the investor for final approval. As you know to get to the final approval stage it takes some time. If your seller is not delinquent the investor may feel this is a strategic short sale and decline the file until their is a true hardship. I have also seen CHASE investors do this as well.
2. If you out source your short sale to a third party negotiator the LISTING AGENT still needs to complete a BofA third party authorization form.
3. If a homeowner receives a letter in the mail stating they are pre qualified for the BofA Cooperative short sale it does not mean they are approved for it. Please note the following in regards to the Cooperative short sale program:
a) Bank of America does not require the home to be owner occupied.
b)The amount a homeowner may get for relocation assistance is determined by the balance of the loan, loss amount, location of the property and the offer. If the seller receives an "Acknowledgment of Interest" the amount of the incentive will be reflected on the document.
c) If the seller receives relocation assistance money between $5000-$30,000, they will receive a 1099 however; if the home is their primary residence they will not be taxed. If it is an investment property they may be taxed. I would have your client speak to a CPA in this regard.
Again, setting proper expectations with the seller and the buyer will save allot of time and energy. When changes like this occur blaming can take place with all parties involved in the transaction. Experience has taught me that frustration most likely occurs due to lack of understanding and communication. Learning and communication are things that we can control. The better we can do this the better we can serve our clients.
Call us today and let us show you a system that works to help you expand your business and effectively and efficiently close short sale transactions.
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