More Bank of America Short Sale Tales…

Probably everyone has heard how horrible it is to do a short sale with Bank of America. Lost packages, files that mysteriously close for no reason, no return phone calls, and notoriously loooooong wait times.

Unfortunately, nothing has changed with them. The short sale process can be quick, painless, and over with before we know it. We can sometimes close short sales in less than 3 weeks with other lenders!!

So why the long, drawn out, 4-6 month process with Bank of America? I don’t really know. There is no good reason why this bank cannot get it right other than pure ignorance for not only their clients but for the economic structure of our country.

What exactly do I mean by that? Take a real world Bank of America short sale example (the names have been changed to protect the victims of another Short Sale fiasco by Bank of America)

“Jennifer” owns an Arizona property worth approximately $250,000. Her Bank of America loan is well over $400,000 and therefore she needs to do a short sale. Jennifer completes all the paperwork and turns it in to her short sale expert real estate agent. The agent lists the property and sells it the first day on the market for full price. He then sends the package along with the offer to Bank of America.

Now the Short Sale fiasco begins! I would go through the multiple times the file is lost, the two times the file is closed for no reason, the 6 different negotiators that were assigned the file, the 5 different orders for bank appraisals, and the approval that was sent and then reneged on 2 hours later but I wont. Instead let’s talk about what happens.

After 5 months of fighting tooth and nail just to get this simple deal approved the buyer finally walks. The agent goes back up on the market but lo and behold, the market in Arizona has dropped some more and now the property is worth less than $200,000.

So the agent reprices the property accordingly and receives a new offer now at $200,000.

Bank of America starts pretty much all over and many of the same issues are dealt with. Finally after 2 more months the deal is finally agreed upon by Bank of America. But wait…

The buyer’s appraiser goes out to the property and realizes that in the last 2 months the market has fallen a bit more. The property is now only worth about $185,000.

The agent now has to go back to the Bank of America short sale department and try and get the property re-approved at $185,000. Meanwhile, even though there is a contract on the property, Bank of America decides to go ahead and change the locks on the person’s house.

Imagine coming home with an armful of groceries to find out you can’t even get into your own home!! They say its a clause in your loan documents to protect their interest in the property but are you kidding me??? People are living there!

So finally the locks are changed back (yet the homeowner never receives reimbursement for the locksmith) another month goes by of negotiating and the bank finally approves the deal at $185,000.

The final tally — By taking so long to approve the property Bank of America lost over $65,000 in market depreciation. Multiply this by the hundreds of thousands of Bank of America short sales around the country and you can see why they single handedly could cause a huge economic downfall here in the next few years.

Bank of America short sales can be done and we do them all the time. But they do take time, patience, and a steady stream of buyers to keep pace with what’s going on in the marketplace.

Our average time from contract to approval with most other banks is 60-70 days. With Bank of America it takes about 120 to do the exact same thing.

Bank of America really needs to get a handle on these issues and they need to get it fast. This company could very well cause an economic collapse of unbelievable proportions if they don’t get their internal real estate deals straightened out very quickly.

Related posts:

1. Bank of America Short Sale
2. Bank of America Approval in less than 30 days!!
3. Standard & Poor’s to Downgrade Bank of America & Citibank?
4. Bank of America & Countrywide Short Sale Update
5. Will Bank of America Buy Back 47 Billion???