RE: Bank Of America Checks Credit to Approve Short-Sale - My Thoughts

By
Real Estate Agent with Easy Street Realty

Below are my comments on a letter written by another agent. My thoughts are in bold; the original letter is in italics.

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I see you’re pissed: Let’s break it down>

The negotiator explained that the investor who will be approving the deal will be pulling my seller’s credit information to verify that the seller also stopped paying other creditors.

KEYWORD: Investor – remember in general there are two large categories in mortgages – INVESTOR and PORTFOLIO – an INVESTOR can ACCEPT< REJECT or COUNTER a request for a short sale to be approved. They lent the money. They are the boss. BofA is simply the servicing lender, not the decision maker.

If BofA determines that the seller has continued payments to everyone else they will likely request a promissory note or cash contribution before approving the short-sale according to this BofA employee.

BofA works in accordance to the INVESTORS demands. They are a facilitator of the process.

My belief is this is one more change to discourage people from attempting a short-sale. People who are walking away with a job and still paying their other bills need to either plan on giving them a promissory note/cash contribution to accept the short-sale or plan on a foreclosure on their credit. Realtor’s who take these listings better get the facts upfront from the seller and make sure they are willing to make this contribution if requested by BofA.

It’s on the ERSA form.

I personally think that what BofA is doing should be illegal and prosecuted. They have no right to pull a consumers credit without their authorization and providing a credit report has never been part of the short-sale package or disclosed previously.

Sorry, but no – not illegal. Once again, it’s a demand by the INVESTOR, BofA are just acting upon that request.

Legally they have no recourse if the property is foreclosed upon and it normally is easy to demonstrate that BofA benefits from accepting a short-sale vs. foreclosure option.

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It basically amounts to extortion and bribery to require a seller make a contribution or accept a promissory note at the last moment after going through the process and trying to do a short-sale on non-recourse loans.

No, I beg to differ. It’s a mitigation. You are asking a financial institution to take less than what is owed. By contractual rights, they have the option to ACCEPT – REJECT or COUNTER based on their guidelines. The seller has the option thru negotiation to decide whether or not a contribution to closing or acceptance of promissory note, fits well into their own financial intentions regarding the short sale. Remember, they are still the deed holder.

This is yet one more example of how our government is no where to be found in assisting the public and these large banks are being allowed to do whatever they want. Shame on Bank of America!

Well, if you want to think that you can. REMEMBER: Short Sales are like cakes – they all different – yet they’re all CAKES> J

 

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