Troubled homeowners may be losing a major lifeline: so-called short sales. To get bad loans off their books and spur home sales, lenders have been forgiving the difference between the outstanding mortgage balance and the purchase price. Banks were never eager participants in short sales, and now financial firms—even those that can offload losses to the government—are balking at such transactions. Some lenders are forcing the sellers to pay extra money at closing. Others want a promissory note for part of the amount due.
The situation could be a setback for the already wobbly housing recovery. A record one-third of borrowers owe more on their mortgage than their properties are worth, notes research firm First American CoreLogic. The number of underwater homeowners will only continue to rise since values are still falling. And if distressed borrowers can’t negotiate short sales, more may be forced into foreclosure, further depressing prices.
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After 9 months of working with Countrywide/Bank of America on 4 short sales, I have one (FL) in the process of closing next week and another FL pending SS approval. 2 (AZ/HI) other have many contracts/files closed without our knowledge while we were waiting for their approvals. On the contrary, presented a SS to GMAC and in less than 30 days, got an approval with no seller contribution or promissory note! Putting another GMAC for DIL (as I told them I have not energy left for SS – husband is mentally ill from stress) and hoping that would be smooth too. BofA has taken my marriage, my husbands’ health and I’m doing all I can to claim my life back!
Bank of America is running a scam, putting people through the process without intentions of seriously considering SS. Clearly appears they just want to foreclose. BTW – the SS in FL required seller’s contribution and AZ property had an approval of sale with seller’s contribution and ‘Investor’ did another BPO (SPO) and denied the negotiator’s offer.