That’s right folks. Bank of America is now among the ranks of lenders offering additional relocation assistance money to certain short sale sellers. In addition to programs such as HAFA or other short sale incentive programs offered by other lending institutions, Bank of America announced last week that they are now offering certain short sale sellers up to $30,000 in short sale incentive money. Many of those that are eligible will receive a letter in the mail advising them about the program and yes, the letter does state that a 1099 will be issued to each short sale seller who receives relocation assistance.
Here are the FAQs (courtesy of our folks at Bank of America):
Q: How can I find out if my client qualifies for this limited time offer?
A: Call a Bank of America short sale specialist at 1.866.880.1232
Q: Do I have to do anything special when initiating or completing the short sale?
A: No. But act quickly by initiating the short sale into the Equator system. This is a limited-time offer that your clients won't want to miss out on.
Q: If a short sale is initiated with an offer, will it qualify for this relocation assistance?
A: No. This relocation assistance is only available on preapproved price short sale programs. Short sales initiated at the time an offer is received do not qualify for the enhanced relocation assistance funds.
Q: Will the relocation assistance funds be reported on the HUD-1?
A: Yes, funds received at closing will be documented on the HUD-1, and a 1099-MISC will be issued.
Q: Can the relocation assistance funds be used to pay off existing liens?
A: Yes, the homeowner may use funds to pay off existing liens or to help with relocation expenses.
Q: Is the relocation assistance added to any other incentives, such as the HAFA or Bank of America proprietary program incentives?
A: The homeowner incentive will be inclusive of the $3,000 HAFA incentive. For example, if the homeowner is eligible for a $5,000 homeowner incentive, $3,000 will be from the HAFA incentive, and $2,000 will be from the homeowner incentive.
Q: Is the enhanced relocation assistance available for other programs?
A: Currently, the enhanced relocation assistance is only available to short sale programs initiated without an offer. However, as we gauge the success we may extend this incentive to other programs.