What is needed to begin the Short Sale Process?
Compile / collect homeowner information:
– Signed purchase contract
– Listing agreement
– Preliminary HUD-1
– Homeowner(s) signed and dated hardship letter detailing why they are unable to pay on their
loan(s)
– Homeowner(s) written permission authorizing Bank of America to speak with the real estate
agent about the their loan(s)
Additional homeowner information that may be required:
– Income verification
– Copy of most recent bank statement
– Copy of most recent tax return
NOTE: Prompt submission of the above listed documents is critical to timely processing of the short sale application
Additional Information
• A short sale MUST be an arm’s length transaction.
– The property may not be sold to anyone with close personal ties to the homeowner, including
business and personal relationships
• Some investors and mortgage insurance companies with an interest in the mortgage loans being serviced by Bank
of America require the homeowner to:
– sign a promissory note or
– make a cash contribution for some or all of the difference between the net proceeds from the sale and
the total amount due on the loan
• Junior Liens and HELOCs are considered in the short sale process.
– Bank of America typically requests the homeowner or his/her agent to negotiate with the junior lien
holder(s) for funds to release their lien(s).
– This may delay the process and the junior lien holder may deny the short sale.
Short Sale Processing Time
Documents
- Allow the appraiser access to the home as early as is convenient to the homeowner
Appraisal
- Complete and accurate information as early as possible for all required documents
- Updated contact information for the appraiser in order to arrange house inspections
Purchase Offer - Ensure offer is the best possible at fair market value and mitigates loss for lender relative to an REO sale
- Listing information and comparables to support price. Bank of America will use an Appraisal to establish value but will review other documentation
Change of buyers or agent - Change of buyers and/or agent at anytime in the process may cause the process to revert to an earlier step - notify us as soon as this occurs
Investor/Mortgage Insurance Approval - Approval from the Investor and/or Insurer only if we are not fullydelegated to approve the short sale
Lack of release on outside second lien - Bank of America must receive proof of release prior to issuing the
Fees & Costs - Fees that accrue during analysis or after approval may affect the
Factors that minimize processing time
Factors that add to processing time
approval letter
transaction
Short Sale Timeline• Bank of America targets for communicating a short sale decision (accept or decline) to the customer:
– A fully delegated short sale decision to be communicated within 45 days
– A non delegated short sale decision to be communicated within 90 days
– Additional time may be required for the closing to occur on a qualified offer and is dependent upon the
seller/homeowner and the buyer
Task Length Cumulative Days
Loan is referred by Home Rentention Division or Customer Service Start 0
File is opened as "Borrower Requested Assistance" 1 day 1 day
Offer received and appraisal ordered 7 days 8 days
Appraisal completed 10 days 21 days
All documents collected by phase 1 negotiator 12 days 33 days
Analysis and negotiations completed by phase 2 negotiator 3 days 36 days
Decision 5 days 41 days
Approvals (time is dependent on delegation of file) 2-30 days 43-90 days
Decision sent 2 days 45-90 days