anyone getting BOA approvals on their short sales?

[ERIC E]

Since they instituted a clause in their approval letter that says they will rescind the short sale transaction if the property is resold within 30 days . This is provision # 10 in their short sale approvals which is policy they adopted from countrywide when they acquired them.
If you have your title agent or attorney challenge this verbiage, BOA/COUNTRYWIDE will usually replace # 10 with a new clause that is even more broad based and prohibitive for flips/resells.
has anyone else experienced this? , or challenged this successfully?

[Scott Hubbard]

Originally posted by H Mann:

I offered 275k on a BofA property. They countered with 370k, which I'm guessing is their BPO.

What do I counter back at? 80% of that? 82%?

I agree with Will... You need to know how much the property will sell for quickly. This is where your listing agent should be helping.

Secondarily, you cannot assume BOA is countering at the BPO valuation. BOA does not always counter at the BPO. Sometimes they counter above, at or below. Where did your market analysis say the FMV is? Assuming the BPO came in at $370K, is that accurate? What are distressed comparables selling for?

Thirdly, it is a fallacy that lenders will automatically discount up to 80% of the BPO.

Instead, substantiate your offer with anything that shows they will NET less as a foreclosure than would by selling to you. At what discount to FMV do homes sell for at the courthouse steps? How much have REO comps sold for? How much is the average foreclosure cost in your area. What are the carrying costs? Does the property need any repairs?

You need to know what it will cost them to foreclose an how much they can expect to NET as a result. After all, this is the formula they base their decisions on.

Lastly, based on your numbers and adding extended financing via Will and 6% commissions, closing costs, a 5% price discount to the end-buyer, then 80% is probably a loser. I think you would be leaving a lot of money on the table if you settled for 80% of BPO.


Good Luck!