Bank of America is encouraging distressed homeowners to explore a short sale as a viable option for avoiding foreclosure. For a limited time they are offering enhanced relocation assistance to help motivate homeowners to engage with Bank of America on a pre-offer short sale.
Almost unheard of five years ago, a short sale must be approved by the lender because the sale amount winds up being less than the mortgage owed on the house. Foreclosures have come to cost lenders so much in terms of sunken prices, deteriorated properties and legal fees that Bank of America announced last week that it would give $5,000 to $20,000 to qualified borrowers who submit a short-sale request to the lender by Nov. 30.
Guidelines for Bank of America's new Florida Enhanced Short Sale Relocation Assistance program state that a borrower may use the incentive to pay off existing liens or for relocation expenses.
Eligibility:
- Homeowners with property in Florida
- Short sales initiated without an offer between September 26 and November 30
- The customer will have to be eligible for one of the without offer programs such as the HAFA program or our proprietary program (specific investor participation and eligibility criteria do apply to these programs)
- Successful closing of the eligible short sale by August 31, 2012
- Minimum relocation assistance is $5,000 and maximum is $20,000, with the specific amount calculated based on the unpaid principal balance
Exclusions:
· Ginnie Mae, FHA, VA and USDA loans are ineligible for participation
· Lot loans are ineligible for participation
· Properties outside the state of Florida are ineligible for participation
· Short sales initiated with an offer are not currently eligible for the enhanced relocation assistance
Short-sale incentives stem from earlier, "cash for keys" programs offered by lenders and real-estate companies. The U.S. Treasury Department has also tried to boost the number of short sales with its Home Affordable Foreclosure Alternatives program, which provides $3,000 for borrower-relocation assistance, $1,500 for servicers to cover administrative and processing costs, and as much as $2,000 for investors who meet certain requirements.
Other Banks are now offering programs as well:
•Wells Fargo offers incentives of $10,000 to $20,000 to certain homeowners who opt for a short sale or who transfer a home's title back to the bank. The program is aimed at properties in Florida and other states known for protracted, judicial foreclosures. The money is available only on first-lien loans that the company owns, which is about 20 percent of its portfolio.
•JPMorgan Chase has not reported how much it offers for short-sale incentives, though real-estate agents have reported sellers getting $20,000. The lender also has declined to specify how it determines the amount of its incentives.
•Citibank has reported it offers an average of $12,000 for borrowers when it owns the mortgage. The amount is determined upfront and varies depending on a borrower's financial circumstances and mortgage-payment history. The money is disbursed when the short sale closes.
Contact me today, to discuss your Short-Sale Options.
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