We are pleased to provide an example of a Federal Government Home Affordable Foreclosure Alternatives (HAFA) short sale program Initial Approval that was generated through bank of America's REDC division. (REDC is a division of Bank of America that deals with these types of short sales. There are other divisions that also provide this service.)
Below is a brief timeline of our experience with this phase of the HAFA short sale initial approval:
2/16/11 - Met with client to review short sale options and best option appears to be cooperative short sale with HAFA as the largest payout to Seller $3,000.
2/17/11 - A new file was opened and authorization sent to Bank of America to begin approval process.
3/2/11 - BOA responds with "Packet sent to Seller who will receive the information within 5-10 days".
3/11/11 - Documents have been compiled and are submitted to Bank of America/REDC on behalf of the Seller.
3/25/11 - List Price is established on-line. Agreement will be drawn up by Bank of America and sent to seller.
3/29/11 - Short Sale Agreement is received and must be approved by the seller.
The basic approval is as follows:
• The process begins by establishing a list price. Once the list price has been set, the property must be actively marketed for 120 days.
• When an offer is received, a Request to Approve a Short Sale (RASS) form must be submitted. A signed purchase offer and proof of funds must be submitted with the RASS form.
• All outstanding liens must be paid or released prior to closing. The HAFA program allows up to $6,000 total of all subordinate loans to be deducted from the gross sale proceeds to pay subordinate lien holders.
• After closing, up to $3,000 can be made available to the seller to offset some moving expenses.
It took six weeks to get the property on the market, but with an initial an initial approval we have a sure starting price; higher likelihood of success and the greatest benefit to the Seller i.e. $3,000 cash and no deficiency!
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