East Bay Short Sale Group just attended a Bank of America (BOA) Short Sale Seminar in San Ramon, CA, which introduced some program changes they have implemented for the duration of 2012. Probably one of the most significant changes that Bank of America has rolled out for short sales is in how they process the files. The old way was sequential, in that seller documentation was collected first, then the BPO (broker price opinion) or appraisal was ordered, then the file when to a negotiator for underwriting. The new way is process these steps simutaneously in an effort to shorten the short sale approval timeframe. We commend Bank of America in doing this as valuations can be scheduled and account payoff demands ordered in advance, thus saving time later in the process.
Another change is that Bank of America now will allow a short sale application to be submitted by a homeowner prior to the home being put on the market or a contract being accepted by the seller. This process is referred to as the HAFA short sale, or the Cooperative (Co-op) short sale which allows the homeowner to be pre-approved for a short sale ahead of time, and in some cases a list price determined for the listing agent prior to the home being listed on the market. Both the HAFA and the Co-op short sale process have benefits to the homeowner doing the short sale, such as delays in the foreclosure process and cash back to the seller after close of escrow.
In any case, once an offer is accepted by the homeowner and uploaded into the Equator system, the new rules allow for the listing agent to submit a back-up offer within 5 days, in case the primary buyer backs out of the transaction. This saves some time processing the 2nd buyer in the transaction instead of starting the short sale approval process over from scratch.
Many times the person doing the BPO or the appraisal may come up with a property value that is not reasonable for the market (too high a list price). Bank of America has changed their valuation dispute process to allow the listing agent to dispute an unreasonable list price by submitting a Valuation Reconsideration Form. This, along with comparatives of area sales, can help the lender adjust the list price to one that can attract offers based on current market demand. Market value discrepancy has often been an issue with short sales so we hope this initiative will better streamline the process and make it quicker to adjust to market value.
Lastly, Bank of America has implemented a 2 business day response time requirement for their staff. If an inquiry has not been responded to within 2 business days, the request can be escalated to a Team Lead, or to the Escalation Dept to get a quicker response. We hope Bank of America will stick to this policy to make the short sale process quicker.
East Bay Area homeowners who are listing their home for sale as a short sale and have Bank of America as their lender should see improvement in processing. If as a homeowner this information seems like overload, don’t worry, we know their processes well and have closed dozens of Bank of America short sales and can help you close yours also. Whether you are already pre-approved through the HAFA program, or just want to get more info on how the process works, we are the listing agents you want on your side to get the transaction closed. Contact us for more info!
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