Bank of America Refines Short Sale Process

The Distressed Property Institute recently hosted a webinar with Mr. Bob Hora, Senior Vice President of Bank of America, to discuss recent updates to BofA’s short sale process.

Mr. Hora asserted that Bank of America is committed to doing short sales and rejected the myth that banks have incentive to foreclose, saying that the bank doesn’t want more repossessed property on their books. Some interesting figures: Bank of America closed 42,000 short sales in 2009, 90k in 2010, will close more than 100k in 2011, and they plan to do even more in 2012.

Short sales have a reputation for taking a long time and BofA’s goal is to shorten the process. They’ve been hiring more people and have gone from 200-250 short sale employees a couple years ago to now having 3,000 employees working just on short sales!

Bank of America is sending out targeted solicitations to homeowners who are at risk of foreclosure. This includes a transition guide that goes over options to avoid foreclosure, deed-in-lieu (DIL) of foreclosure, why you should consider a short sale, HAFA, avoiding scams, etc.

Mr. Hora went over some of the reasons that keep BofA short sales from closing, such as improper documentation, valuation issues, unallowable fees, etc. Also outlined were the specific procedures to escalate a problematic BofA short sale. It is Bank of America’s belief that a “trained agent…makes a big difference.”

He reiterated that agents should be expanding their short sale knowledge, should know their marketplace, and should set appropriate expectations with everyone involved. Short sales aren’t going away anytime soon and they’re usually a worthwhile alternative for homeowners facing foreclosure.

In Flagstaff, the number of short sales and foreclosures have been holding steady, but with improved processes and agent training on short sales, perhaps we’ll be able to put a dent in the number of foreclosures.

Top Reasons to List Your Home In The Winter

Many people ask if they should list their home in the winter or wait until the following spring. Despite the sometimes snowy and cold winters in Flagstaff, there are many good reasons to list and, yes, homes do in fact sell during the winter months.

Being that your home can sell anytime of the year, it’s more important to sell when you’re ready than to try to time the market or season perfectly.

Here’s a list I created of reasons to sell your home in the winter. As much as I wanted to make this a “Top 10” list, I have come up with eleven great reasons. So here goes…

    1. You have less competition from other sellers because many homes come off the market.

    2. The buyers who look in the winter are more serious buyers.

    3. There are, indeed, plenty of buyers in the winter – some examples include: people who get relocated, people who sold in the summer and have been living in temporary housing until they find a place, and first-time homebuyers whose leases may end in the winter.

    4. There are, in fact, numerous sales in the winter. Over the past six years, almost half of my sales have been between October and March.

    5. Some motivating factors for buyers don’t depend on the season. For example, a new child being born may cause the family to want more space as soon as possible.

    6. Many people have a strong motivation to spend the holidays in their new home.

    7. Many people review their goals and finances around the first of the year and may decide that it’s time to buy a new home.

    8. Some buyers may have more time to look for homes when they have off for the holidays.

    9. Some homes may show better during the winter because they’re already being kept clean and decorated for the holidays.

    10. Some people must buy before the end of the year for tax reasons.

    11. We know what the current market and prices are like. We don’t know if it will be better or worse next year!

Pre-Approved Short Sales

Some buyers in Flagstaff seem to be wary of making offers on short sales for a couple reasons in particular. They don’t know how long the process will take and whether the short sale or price will even be approved.

This is understandable considering that in a conventional short sale, the seller’s lender (who has to approve the short sale) isn’t involved much, if at all, until there is a contract to purchase the home. There are things a knowledgable real estate agent can do to shorten the time frame and increase the chances of success; however, in this situation there’s no way of knowing exactly if and when the short sale will be approved.

Herein lies the benefit of pre-approved short sales. In a pre-approved short sale, the seller’s lender approves the short sale upfront (before an offer is made). They determine a minimum price or net proceeds that they’ll accept and they usually have set time frames for responding to offers. As you can imagine, this makes the listing that much more appealing to buyers, who then have a better idea of their chance of successfully closing on that short sale in a reasonable amount of time. Another benefit is that there’s usually a specific amount of time that the foreclosure process is halted while the seller attempts to sell the home.

The two most common types of pre-approved short sales are HAFA and FHA. In these programs, the short sale is processed through your lender but the guidelines and qualifications are set by the government. Unfortunately, not every loan or borrower is a candidate for these programs and not every lender participates; however, it’s worth finding out. Many major lenders, such as Citibank, Wells Fargo, Chase, and BofA are also beginning to roll out their own “in-house” pre-approval programs. If you’re a homeowner considering a short sale, the first person to talk with is a real estate agent who is knowledgable about short sales and can walk you through some different options.

New Toddler Park in Boulder Pointe

Picture of the small park in the Boulder Pointe neighborhood
The neighborhood of Boulder Pointe in Flagstaff finally has their own neighborhood park. It’s a small toddler park (or “tot park”) with swings and playground equipment. The HOA and homeowners had to take matters into their own hands and build the park in what was an HOA-owned lot used as a drainage basin.

This is a private park for Boulder Pointe residents and is meant as a “walking” park as there is no parking for the park.

Neighborhood parks are always great for the sense of community and I’m sure the residents of Boulder Pointe will be pleased to finally have a place to take their young ones.