I attended a “webinar interview” by Alex Charfin of the Certified Distressed Property Institute and Bob Hora from Bank of America.

After listening to this interview, I think the banks finally got it. Short sales are more productive and profitable for the banks and better overall for the economy, the homeowner and the community.

Going forward Bank of America will be reaching out to troubled homeowners. It wasn’t clear at what point this would happen, i.e. how far behind on their mortgage they are, but I am guessing because each State has different regulations for foreclosures, etc. it was hard to be so definitive during the interview.

According to Mr. Hora, Bank of America now has a staff of over 3000 employees dedicated to working Short Sales. They have better systems and processes in place such as one person handling the file not someone new every time we call in for a status. Real Estate agents who have worked short sales with Bank of America know that everything starts with Equator. Unless the documents are uploaded in Equator, no amount of telephone calls to the bank will get a response.

Homeowners, buyers and real estate agents become frustrated with the length of time it takes for a short sale to get processed and the reality is that banks have relationships with over 500 investors on the loans  each with their own guidelines as to how to handle distressed sales.In addition each state has regulations for the banks to follow.

A couple of key items I took away from the call:

  • Bank of America wants to do short sales and not foreclosures
  • Processes are now in place to guide the homeowners – either loan modification, short sale, deed in lieu
  • Specialist assigned as soon as docs are uploaded in Equator
  • Service Level Agreements -commitment to communicate to Real Estate Agents within a predetermined schedule and if they don’t – we can escalate to the next level
  • Investors are classified as delegated and non-delegated. If non-delegated then the bank can make the decision regarding the price and terms. If delegated they must go back to the investor for approval. You can ask your specialist who the investors is on the loan. Previously they were reluctant or couldn’t disclose this information, but knowing the investor will help real estate agents understand just how long it will take to get the short sale processed.
  • Fraud checks in place – ensuring market data is accurate, arms length transactions, real estate agents do not represent themselves in short sales, and sometimes depending on the investor an agent cannot handle both the listing and sale of the property.

Bottom line – Bank of America projects short sales to increase 60-70 percent in 2012 as compared to 2011. This is good news for homeowners.

To better understand your options, pick up a copy of  the “Bank of America’s Home Transition Guide”

About Linda Urbick Linda

has written 261 articles on this blog.

Filed under: Real Estate

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