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Interesting move by Warren Buffet to invest $5 billion in BofA this week. While that news may be indirectly relevant to this blog, I have another news to share regarding Bank of America’s new short sale policy, which allows real estate agents to substitute a new short sale buyer without restarting the often complicated process of a short sale transaction. Here are the details:
Bank of America now allows real estate agents to submit a backup offer on a short sale transaction if the original buyer has walked away from the sale. This means agents will no longer have to initiate a new short sale via Equator (a file management system). Instead, they can continue with the original transaction in Equator and work with the same short sale specialist. This is a HUGE change that will save time for sellers, buyers and REALTORS by not having to repeat a number of short sale processes again and again.
When a Backup Offer Is Ready
Real estate agents should send a message to their short sale specialist via Equator when the original buyer is no longer interested in the property or simply walked away from the transaction. The Bank of America short sale specialist should respond within two business days and ask if the agent has a backup offer ready to submit. If another buyer is prepared to make an offer, the short sale can proceed without having to repeat the short sale initiation steps. The short sale status in Equator will change to “marketing,” and agents will be directed to complete the following tasks within 14 business days:
1. Complete the “Listing Data” task.
2. Provide the marketing description.
3. Review the marketing plan.
4. Upload the purchase offer.
The real estate agents will then have 14 days to complete the “Listing Data” task. If the task is not completed on time, the file will be closed.
When No Backup Offer Is Ready
This new process applies only if there’s an available backup offer when a buyer walks away. If a backup offer is not ready to be submitted, the short sale will be declined. In that case, real estate agents should return to marketing the property and initiate a new short sale in Equator system once another offer is received.
This is definitely great news for the real estate industry as we continue to see short sales on the market. It’s a win-win all around. If you’d like to learn more about this topic, don’t hesitate to contact me.
Ihor Pochay
BROKER/SHORT SALE & REO SPECIALIST
Team Pochay Realty
C (562) 334-7393
ihorpochay@hotmail.com
TeamPochayRealty.com
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Friday, August 26, 2011
Tuesday, August 2, 2011
California Governor Signs SB 458 – No Deficiency After Short Sale for Junior Liens
Good news for California homeowners considering a short sale! SB 458 was signed, which is the new California law that extends the protections of SB 931, ensuring that any lender/bank that agrees to a short sale transaction for a residential property from 1 to 4 units, must agree to the short sale payment as payment in full for the outstanding balance of all loans (first/second/third mortgage liens, HELOC, etc.).
What is SB 931 any way? It was a law signed in 2010, which stated that after a short sale transaction is completed in California, lenders/banks cannot pursue the homeowner/seller for the remaining balance of the loan (amount owed minus the sale price). But unfortunately, this rule did not apply to junior lien holders (second/third mortgage or home equity line of credit/HELOC). SB 458 extends the protections of SB 931 to junior liens.
For sellers who conduct a short sale after July 2011, SB 458 means that a short sale junior lien holder cannot require additional compensation (cash contribution, promissory note, etc.) as part of the short sale approval. If needed, the agent still can contribute to make the transaction go through.
SB 458 ensures that after close of escrow in a short sale transaction, there is no possibility that the lender can pursue the borrower/seller. Therefore, the lien and (personal) liability will be released by all lenders involved in a short sale.
These two short sale laws combined with the Mortgage Forgiveness Act, make it perfect for Short Sale transactions to be conducted in California.
If you are behind on your payment or simply need to move to another area but your house is upside down (you owe more than it's worth), give me a call and I will make your transaction as smooth as possible.
Ihor Pochay
BROKER / Short Sale & REO Specialist
Team Pochay Realty
Cell: (562) 334-7393
www.shortsaleyourhome.blogspot.com
DRE# 01772584
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