Kris and I live in the “Inland Empire”; one of the hardest hit areas of the country. Being Real Estate Agents, our decision to become Short Sale experts was an easy one. Our lives are touched daily with calls from people that are loosing their homes. Using everything we’ve learned during our training and experiences that we deal with daily….trying to help people that truly want to avoid foreclosure…however, nothing to date has hit me like this news.
As of 9/1/2008 Bank of America has implemented new criteria for short sale acceptance. The criteria states that Bank of America will accept no less than a 10% payoff of a debt balance being charged off as collectible. The criteria also states that Realtor commissions shall not exceed 4%.
Here’s proof BofA is sticking to the new criteria…
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What’s going on in America? The state of California passed a bill that becomes effective on or around September 8th SB1137 ordering all lenders doing business here in California to find alternatives to foreclosure
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Bank of America beat the law makers here in California by 8 days! Their new criteria became effective September 1, 2008.
A piece of information that we’ve learned over the past year; when dealing with mortgage lenders that hold the first lien on a property…most if not all, allow only 3% of the sales price to go to subordinates, some cap at a maximum pay-off of $1000. Way to go BofA, do you share this decision making information with shareholder? The shareholders that will soon feel sharp declines in stock prices…due to this stupid “un-thought” process
I’ve found some fuel to add to this fire that BofA has started and will most likely let burn ’till it hurts many.
Foreclosures accelerated to the fastest pace in almost three decades during the second quarter as interest rates increased and home values fell, prompting more Americans to walk away from homes they couldn’t refinance or sell.
New foreclosures increased to 1.19 percent, rising above 1 percent for the first time in the survey’s 29 years, the Mortgage Bankers Association said in a report today. The total inventory of homes in foreclosure reached 2.75 percent, almost tripling since the five-year housing boom ended in 2005. The share of loans with one or more payments overdue rose to a seasonally adjusted 6.41 percent of all mortgages, an all-time high, from 6.35 percent in the first quarter.
Tumbling home prices are making it difficult for even the most creditworthy owners with adjustable-rate mortgages to sell or get a new loan as their financing costs rise, said Jay Brinkmann, MBA’s chief economist. Prime ARMs accounted for 23 percent of new foreclosures and subprime ARMs were 36 percent, he said.
“People chose the lowest payment option to get into some of the very expensive housing markets and now that prices are coming way down, they can’t sell and they can’t afford the higher payments,” Brinkmann said in an interview. The unadjusted rate for new foreclosures was 1.08 percent, also a record, he said.
Foreclosures started on prime mortgages rose to 0.67 percent from 0.54 percent and the foreclosure inventory increased to 1.42 percent from 1.22 percent, the report said. The share of seriously delinquent prime mortgages was 2.35 percent, up from 1.99 percent.
Existing home sales fell to a 10-year low in the second quarter and the median price for a single-family house dropped 7.6 percent, according to the National Association of Realtors in Chicago.
Sales of previously owned homes rose 3.1 percent in July to an annualized pace of 5 million, boosted by foreclosures that accounted for about a third of all transactions, the National Association of Realtors said in an Aug. 25 report.
Some content from Bloomberg.com
