You are here:
| Orlando Short Sales may get easier when it comes to: Bank of America Short Sales |
 |
 |
 |
| Thursday, 30 April 2009 12:51 |
|
and second mortgages that would otherwise be worthless if the short sale property went to foreclosure. Bank of America had been among the least cooperative of all banks in agreeing to short sale payoff terms, according to industry critics. The company’s policy was blunt: Pay us 10 percent of what the homeowners owed on the equity line balance or second mortgage, or we won’t sign off on the short sale, which is necessary for the deal to go through. Now the bank has adopted “a less arbitrary, more rational” policy. “What we’re saying (to short sale proposals) is — give us an opportunity to participate and gain at least some of the savings” that will go to the first lien holder — the primary lender on the property — by avoiding the high expenses and losses of a foreclosure. Bank of America is now asking for five percent of the sale proceeds on the short sale, net of realty commissions, closing and other costs. The bank believes that should open the door to more successful transactions, as well as more fruitful negotiations with buyers and sellers to avoid foreclosures. The bank’s previous 10 percent policy meant they’d demand $20,000 on a $200, 000 equity line balance, or they wouldn’t bless the deal. But their new policy still means “they want $10,000 if the net proceeds are $200,000″ on a short sale, — even though the economic value of their holding may in fact be zero. Bottom line for investors: If there’s a Bank of America second mortgage or credit line on the house you’re after in a short sale, work the new numbers. At least some of the time you might be surprised that the answer from the big bank is now ‘yes.’ And watch for other major banks to follow suit. |
Real Estate News
- Cushman and Wakefield Inks 114,000-Sq.-Ft. Lease in Casa Grande, Ariz
- CT REIA Announces February 2012 Real Estate Investing Seminar With Business Automation Expert Zack Childress
- Southern California Real Estate Club Gives Real Estate Investors Best Marketing Practices
- CRE Show: U.S. Apartment Market Continues to Roll
- TCG Presents Free Educational Seminar in Aventura for Condominium Board Member Certification