That’s right folks. Bank of America is now among the ranks of lenders offering additional relocation assistance money to certain short sale sellers. In addition to programs such as HAFA or other short sale incentive programs offered by other lending institutions, Bank of America announced last week that they are now offering certain short sale sellers up to $30,000 in short sale incentive money. Many of those that are eligible will receive a letter in the mail advising them about the program and yes, the letter does state that a 1099 will be issued to each short sale seller who receives relocation assistance.
Here are the FAQs (courtesy of our folks at Bank of America):
Q: How can I find out if my client qualifies for this limited time offer?
A: Call a Bank of America short sale specialist at 1.866.880.1232
Q: Do I have to do anything special when initiating or completing the short sale?
A: No. But act quickly by initiating the short sale into the Equator system. This is a limited-time offer that your clients won’t want to miss out on.
Q: If a short sale is initiated with an offer, will it qualify for this relocation assistance?
A: No. This relocation assistance is only available on preapproved price short sale programs. Short sales initiated at the time an offer is received do not qualify for the enhanced relocation assistance funds.
Q: Will the relocation assistance funds be reported on the HUD-1?
A: Yes, funds received at closing will be documented on the HUD-1, and a 1099-MISC will be issued.
Q: Can the relocation assistance funds be used to pay off existing liens?
A: Yes, the homeowner may use funds to pay off existing liens or to help with relocation expenses.
Q: Is the relocation assistance added to any other incentives, such as the HAFA or Bank of America proprietary program incentives?
A: The homeowner incentive will be inclusive of the $3,000 HAFA incentive. For example, if the homeowner is eligible for a $5,000 homeowner incentive, $3,000 will be from the HAFA incentive, and $2,000 will be from the homeowner incentive.
Q: Is the enhanced relocation assistance available for other programs?
A: Currently, the enhanced relocation assistance is only available to short sale programs initiated without an offer. However, as we gauge the success we may extend this incentive to other programs.
Short Sale Expeditor
{ 35 comments… read them below or add one }
Melissa – I’m assuming this is just for 1st loans, correct?
Yes, that is correct. This is for first mortgages only.
Melissa, I have questions. We were approved for the enhanced relocation assistance and our short sale will be going to escrow in the next couple of weeks. My question: Can I combine the relocation money, with gift money from my parents and also some additional financing from a Hard Money Lender to purchase another property instead of paying rent? What if it’s the same lender? Will my new purchase cause a problem if it closes escrow before my short sale does? Since my short sale was my primary residence, I qualify for the Mortgage Forgiveness Debt Act, but if I buy a property as my primary to move into before the short sale actually closes, will I put myself at risk for the Mortgage Forgiveness Act?
My experience is this ” preapproved price short sale program ” always has the ” determined ” listing price about 15% above market price, and the price must stay for 90 days.. virtually killing any deal. You can ” try ” to challenge their price, but only with a certified appraisal submission ( $450 expense ), then it takes them 60 days or so to review your rebuttal. I avoid ” pre-approved price ” programs at ALL costs. Usually a government insured loan, that pays upon FORECLOSURE only… thus the high list price demand. If anyone has success with this, let us know …. either way.
I started a standard short sale, which then become a cooperative short sale with BofA.
The original short sale was approved at $190,000. The buyer did not get loan approval and backed out. Then BofA offered the Coop and we started the process. BofA did a new BPO and suggested a list price of $152,000. 3 weeks later they dropped the price to $139,800. I now have an offer at $141,000.
The main reason for the reduction is a recent sale came in at $160,000.
So, not all properties fit the mold of BofA listing the price above market.
Good to hear. We did have one last year where the buyer was going to pay 310k, but B of A said the property was worth 218k; they had a very bad BPO and there was no convincing them otherwise.
In the past I’ve avoided the pro-active dept like the plague based on horrible results. However, I’ve had TWO so far this year where I submitted as a traditional or HAFA short sale with an offer in hand but BofA routed into their pro-active dept. Both times they came back to me with their “pre-approved list price” that was about 15% too high like the prior poster reported. They told me I “had” to list at that price for X number of days. I just ignored that request and submitted it showing my MLS report at the market value, then the offer and comps at market value, and both times they approved within a month or two at market value and we closed. If Sellers can possibly get up to $30K, can’t see how we CAN’T run them all through BofA proactive through end of this year. Otherwise, I don’t think we are fulfiling our fiduciary duty, regardless of how bad BofA pro-active has been in the past.
What determines the amount of your relocation assistance? There’s a big jump between 5000 and 30,000….
Just an FYI, the key component for the homeowner to qualify for the relocation assistance program is that the investor of the note MUST be owned by SSO Delegated, HFI investor, and Freddy Mac owned. Value can always be disputed with 3rd party BPO. Hope this helps someone .
Also, another eligibility for the Enhanced Relocation Assistance Nationwide program you have to initiate a proactive hafa/coop short sale between May 3rd-December 2012. Also, be sure to make sure that your investor participates as well. The relocation amount is determined after a full walk in appraisal is completed, and you are given the amount at the closing of the short sale.
We have made an offer for a short-sale home. It has been approved by the seller, and by the bank. Now, the lender, the bank of America is supposed to agree with the offer, and make it all final. It has been at least 75 days, may be longer. How much longer do we need to wait? Why is it taking so long? Thanks. The whole thing has been going since the month of February.
What do you mean it was approved by the seller and by the bank? If that’s the case, then it should be done. If you agree to the counter offer on Equator, it shouldn’t take more than a few weeks (at most) to get the approval letter.
How long after receiveing the bank’s “approval letter” should you expect to close and be done with this process?
You can close immediately upon receipt of the short sale approval letter. The approval letter has a ‘close by’ date. And, you need to be certain to close prior to that date. Hope that helps!
Does anyone know if there is a restriction to the use of funds for the relocation incentive.
Hafa approved $2500
Now BofA is offering $5900 to the seller.
The listing agent is paying a $1500 fee to the negotiator. Can the listing agent ask the seller to contribute $1500 from the relocation funds to pay the negotiation fee?
BTW, the house has been vacant for over a year, so the buyer has already relocated.
Mellisa,
I am in default on my loan for the past 8 months with BOFA…………..and my broker is working on a short sale with various clients………….would i be eligible……….i was told if you leave the house early in good condition the bank considers it and hence looks at finding a buyer faster……….
please advice
Sorry, but that is not true. You can do a short sale and you can stay in your house until the bitter end. In fact, since the house still belongs to you until it closes escrow or is foreclosed, it may be good to stay. However, if you list the property for sale, make sure to be flexible when agents want to show it, so that the agent can get an offer fast!
Thanks! Finally got the letter, closing October 11th! This 1 year ordeal will finally be over! Thank the LORD!
I have been approved for a short sale of just 24,700! My house has a new roof,new vinyl siding, 3 bedrooms, detached garage, 1.5 baths, 1417 feet, finished attic……yeah! It’s in the NE Ohio area…..if you are interested let me know. I already have two people looking at it today and this happened Monday!
The home is 24k? Wow, is that ever the deal of the century. Best wishes to you!
Our home just listed for 134,900. It has been approved for a short sale and relocation assistance by BOA. Do we forfeit that if we move before the house is sold? Can we turn off the utilities? We do not want to lose the BOA relocation assistance. Please advise.
I’m glad to hear of your short sale approval. We’ve found that most clients do move before closing. However, you may be contractually obligated to keep the utilities on thru closing. You’ll need to check with your agent on that.
we already relocated….but now we have an offer to do a short sale…..can you some how explain to us if we will get a relocation expense?
There are certain programs for which the home does not need to be owner-occupied. Perhaps you can qualify for one of those. Speak with your agent.
How will they calculate the amount of relocation assistance. in other words how much can i expect to receive if i qualify. ? Would being 150k difference from the price of the home and market value make a difference?
Are you entitled to relocation assistance if you don’t live in the home you are short selling?
Yes, you can get relocation assistance for a non-owner occupied property, and even a vacant one. Tenants can even receive up to 3k, if they stay until closing.
Do you have someone you’d recommend with your experience in WA state?
My auction is set for april 2013
Hi Melissa my name is Henrique Munoz I short sale my house and my HAFA relocation money was sent to the title company Sonoran Title in Tempe AZ. I was told by them that I had a lien on my house and that the buyers were ready and all the paper work was done and since I had a lien I would have to forfeit my HAFA money and sign a waiver, I told them I didn’t have a lien but was told to sign anyways just in case there was one, I knew I didn’t have one and they had all the proof! when I resubmitted my proof Sonoran Title had sent the paper work to BofA I have been trying to get my money back since 08/12, BofA and the Sonoran title have been dragging their feet and sending me back and forth, I had to move out without that relocation money and I have not been able to recover financially we are struggling still I just don’t know what to do, can you help us resolve this manner? please let me know, BofA and Sonoran title stopped answering my calls and have not contacted me.
While we work California and are not Arizona experts, it sounds to me like the title company may be holding the money in trust just in case they needed to pay off some errant lien. Can you file a claim against Sonoran Title or can you ask to see the final HUD-1 in order to see whether and where that money went at closing? If you cannot get anywhere, then I would recommend an attorney. Even if it costs you $200 for him or her to write a letter or make a call, it may be well worth it because you could recoop the other $2800! From the limited info you provide, it sounds like a title/escrow issue and not a B of A issue. Good luck!
My husband had a short sale that took 3 years to finally sell with BOA. Last week, we received a 1099 for $4,000 for the assistance program but he didn’t received any money.The ex wife signed the papers before my husband did so we are wondering if there is any type of fraud possibly going on. Maybe they are holding it? Do we go back to the title company?
Yes, you need to take that 1099-MISC back to the escrow or title company that handled the closing. Ask them to show you where the money went. Was it used to pay off another debt? disbused to another person? or is it still there for you to collect? Good Luck!
we did a short sale on our duplex, we lived in the larger unit and tenant in the studio. When the short sale closed, we received HAFA relocation assistance, but the new owner allowed the tenant to stay, which she elected to do. That was 4 months ago, now she’s giving notice and is asking us for relocation money. Is she entitled to that since she wasn’t asked to vacate the property when the short sale closed and the new owner took over?
Hi I did a short sale on my property and got the relocation assistance , the new owners dont want to see me leave , will i get in trouble if i stay?
Well, if you signed an affidavit, addendum, or approval letter (or other form) that says that you would not continue to reside in the property (and 99.9% of all short sales include that terminology some place), you should probably call the lender and see how to proceed.
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