Cooperative Short Sale with Bank of America
A cooperative short sale with Bank of America is definitely easier than a traditional one, but it is still somewhat time consuming and cumbersome. I experienced various challenges during the transaction (while acting as a listing agent) because I had difficulty getting the bank representative to call me back. Sometimes I made multiple calls without being called back. Also, I was never able to communicate directly with the bank representative.
Well, the good news is that the transaction was closed and the seller received the relocation bonus of $ 3,000. The bad news is that it took almost as long as a traditional short sale.
The only time savings I noticed was due to the fact that the buyer had already sent a distress letter to the bank, and the bank was willing to consider the short sale.
The real benefit I noticed was that the bank was in control of the prices. They did a BPO (Broker’s Price Opinion) and allowed us to put the property up for sale at a price they considered reasonable. Price reductions are pre-approved, so we did not get any rejection from the bank once we submitted an offer. This was also a benefit because the buyer had a fairly high level of confidence that the bank would accept the pre-approved offer, so they were willing to stay. One of the big problems associated with short sales is that buyers often walk away after a few months of waiting.
Of course, working with Bank Of America requires the use of the “Equator” system. This is a program that tracks all correspondence with the bank and requires the listing agent to perform certain tasks. I understand the reasoning behind the “Equator” system: be systematic and keep all correspondence alias: CYA. However, the system is clumsy and other banks can track the transaction on the back end and are more effective.
Also, the equator will not allow you to upload an offer now and supporting documents later. This can be a problem because you want the bank to know that there is an offer, but you may not have all the supporting documents the bank will need at a later date. This is a big problem if your foreclosure date is approaching.
In general, it is not easy to work with Bank of America.
I recently closed a “cooperative short sale” of steroids with Chase Bank. They offered my clients $ 15,000 to participate in a short sale. Dealing with Chase in his cooperative program was very easy, and I was able to communicate directly with the account manager over the phone many times. This was really shocking to me. I guess I’ll do another follow-up on this article in 2012, if we can close this transaction. Chase was highly motivated to help sellers avoid foreclosure.