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Daniel Chan, Renter in Upper East Side, New...

Short Sale Counter Offer from BoA

Asked by Daniel Chan, Upper East Side, New York, NY Sat May 4, 2013

We received a counter offer from BoA for our short , which BoA is countering for us to pay for the commission as well as other fees and taxes as well as couple of lien payments. My question: has anyone experience that before with BoA? Is it typical for them to do a counter in this way vs changing the price?

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9
Hi Daniel,

Not knowing your situation, the property's condition, the offer, etc it is hard to comment on why BoA is following this course of action.

In negotiating Short Sales, you typically find a bottom line at which the lender will accept, hopefully, sooner rather than later. This bottom line includes all expenses and unless they can achieve this number they will come back to ask for just about anything. With that said, based on appraised value there may not be any justification for them to request a higher price which they know it will not sell out and, therefore, based on your situation which, as I stated above, I have no insight they might be coming back to you to kick in for these expenses.

My recommendation would be to discuss this with your Realtor who has listed your property, who you should have given authorization to speak with BoA on your behalf for an explanation.

I hope this helps.

Have a GREAT day!

Best regards,
Emil

Emil Veltre, R.Ph, MS, CDPE
Realtor Associate
Liberty Realty
mobile: 973.868.4034
e-mail: EmilVelte@aol.com
Website: http://www.EmilVeltre.com
0 votes Thank Flag Link Mon May 13, 2013
By the way - you provided them an 'offer' ... a real deal (if the buyer can actually get a loan) Vs. making a counter and upping the price which could very well be declined by the buyer and bust the deal; in fact they might still want you to contribute the same $ if the price was higher.
0 votes Thank Flag Link Thu May 9, 2013
If you have a verifiable financial hardship and are low on cash reserves (or are 90+ days delinquent with a FICO below 620) you could qualify under the Foreclosure Alternative Short Sale programs offered under HAMP and both Fannie Mae and Freddie Mac where these costs would be paid by BofA; otherwise You are dealing with the Loss Mitigation dept whose job is to lose as little as possible and they analyze everything you provide... and your credit standing If you are in a state where the lender can sue you for any loss they incurred on a foreclosure ('deficiency balance') they will - in fact they are required to by both Fannie Mae and Freddie Mac, if you look collectable. So the questions to them are: can you afford to pay the mortgage? What if you Refi? Do you have money in the bank to make the payments with or pay towards the sale? What about you selling some assets to get the cash - like an extra car (for real)? What is having good credit likely worth to you - a foreclosure will cost big points and no home financing for up to 7 years if you were a walk away (vs short sale 2-4 years) - and don't forget that BofA is likely not the owner of the mortgage so they lose nothing either way - yet as the Servicer they will earn extra money (late charges, etc) by foreclosing. Every 'deal' is unique to the homeowner and the value to BofA.
0 votes Thank Flag Link Thu May 9, 2013
Normally, the seller bears the responsibility of providing the buyer with a clear title. This tactic may be fairly common, and you can counter again but the biggest concern for me is embracing "a couple of liens." Once this door is opened, it may not be clear exactly how deep the hole goes.

Daniel, before proceeding with this one, it might be beneficial to process this with an attorney. I'm certain they will advise you on the best course of action.

Good luck,

Bill
0 votes Thank Flag Link Sun May 5, 2013
You can counter again and include them in the offer price just raise the offer price.
0 votes Thank Flag Link Sun May 5, 2013
Hi Daniel

It does happen, if the bank deems you are getting an excellent deal and what their
perceived value of the property is.

Good luck.

Perry
Web Reference: http://www.ruthandperry.com
0 votes Thank Flag Link Sat May 4, 2013
If I understand your situation, correct me if I am wrong, you are the sellers and BoA has countered an offer you accepted?

Yes, that is very common, the banks in most cases do not participate in setting the asking price, their involvement starts when an offer has been submitted and accepted by the owner, at which point they send a rep who does a short form appraisal (BPO). If the offer price does not check against the opinion, they will counter the offer.

Only in special cases of cooperating short sales does the bank give a price for the listing agent to list the property at.

Hope this helps!

Sincerely,

Amos Elroy
CDPE (Certified Distressed Property Expert)
SFR (Short-Sale Specialist Certified)
CHBA (Certified Home Buyer Adviser from NAEA)
CSBA (Certified Home Seller Adviser from NAEA)
NAEA Member (National Association of Expert Advisers)

Residential Real Estate Expert Adviser

Lic. Realtor Associate
EXIT On The Hudson Realty
(888) 462-6573 / (888) HOB-NJRE
FAX (888) 462-6573
Office 201-437-0411
http://www.HobNJRE.com
0 votes Thank Flag Link Sat May 4, 2013
Do you know which investor holds the mortgage? I have an FHA short sale through Bank of America and FHA is insisting on 88% of the appraised value as their 'net', which means someone (not FHA) has to pay the realtors' fees, closing costs, relocation monies, etc. if the offer is not high enough. I think this is the most ridiculous thing I have ever heard of, especially considering that, again in my opinion, the appraised value was too high, but they WILL NOT BUDGE! They expect either the buyer will pay these costs or that everyone involved, realtors', attonneys, etc., will work for free just because THEY want what THEY want.
0 votes Thank Flag Link Sat May 4, 2013
Yes, I have seen some wacky responses from the different banks lately. Since the national seems to be in an "Seller's Market" now and property values are on the rise, it appears that the banks are increasingly putting their foot down and seem to be less willing to accept the offer as written by the buyer's agents. Expect this to increase as the values on homes continue to raise. Since we're still are having problems with appraised values paralleling the asking prices, the banks will usually want all cash offers or rather than worry about the appraisal not coming in, just make the buyer cover some of the seller's costs.

Best of Luck!
0 votes Thank Flag Link Sat May 4, 2013
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