Elizabeth Weintraub • Sacramento Short Sale Agent • Land Park

Just because I have a fondness in my heart for doing Bank of America short sales does not mean I favor the bank over my sellers. Sometimes, sellers don't know which side their Sacramento short sale agent is on. But I can assure you that I am looking out for my seller. I do not work for Bank of America. Bank of America does not pay my commission. The seller pays the commission in a short sale.

Oh, sure, you'll see agents advertising that all of their services are free to the homeowner. That's a big fat lie and those agents could lose their real estate license. It's deceptive advertising. All the fees in a short sale come out of the proceeds of sale. The proceeds are given to the seller, and the seller pays the costs of sale upon bank approval. The only difference between how a short sale is handled and a traditional sale (with regards to disbursement) is that the seller doesn't put any money into her pocket. But the seller pays the commission. No iffs, ands or butts about it.

Short Sale: Buyer $$ >> seller >> seller pays $$ fees = balance $$ to bank.

Traditional Sale: Buyer $$ >> seller >> seller pays $$ fees includes $$ to bank = net profit to seller.

The question is not whether a Sacramento seller pays anything in a short sale -- in California you can give thanks to Senate Bill 458 -- the question is does the seller take any money out of her pocket? The answer to that is no. OK, maybe for a condo cert, but nothing else except utilities. You've gotta pay the utilities.

The bank will most likely also pay delinquent property taxes. I've yet to have a bank refuse to pay property taxes. If you want the straight scoop on a short sale, call me, Elizabeth Weintraub, your Sacramento short sale agent, at 916 233 6759. I cover a four-county area in Sacramento.

Yesterday, for example, I sent a Tweet to Bank of America because a file was stuck at MI. I sent a direct message through Twitter. Explained the problem in a succinct manner -- the way one can with only 140 characters to work with. This time, Bank of America didn't Tweet back or even call me. It just fixed the problem. Voila! All of a sudden, Equator sent a message with a final worksheet. We're on our way to short sale approval.

In fact, I am regularly receiving email updates on my Bank of America short sales -- and I have a boatload of them at the moment. Bank of America has really stepped up to the plate in the short sale department. I have extensively studied this bank, and I know its underside. I can say this, if you're having trouble with a Bank of America short sale, you're not working with this Sacramento short sale agent.

I'm such a nerd that I routinely read Notice of Default reports. I periodically check the records to make sure that none of my Sacramento short sale listings is headed for auction. I'm not gonna be that Sacramento short sale agent caught with my pants down who gets a call from the REO agent asking if he can take my key out of the lockbox. It's been a long time since I've had a short sale go to foreclosure. My short sales tend to close.

I monitor not only my active short sale listings but also the active short contingent and the pending listings. In most cases, once the Notice of Default is filed, the clock just keeps right on ticking. The foreclosure action does not stop. You might think it stops in a HAFA short sale, like it's supposed to and regulated as such by the government, but it doesn't necessarily.

About 15% of my listings have a Notice of Default filed. That's not so bad. But three of them have a sale date right around Thanksgiving. Most banks won't postpone until we get closer to the sale date. I think the banks must enjoy making the short sale agents and their nervous sellers chew their fingernails. It is a nail biter sometimes.

Like yesterday. We yanked a short sale out of the fire. It was a Bank of America short sale. The seller hasn't made a payment in two years as she struggled with a loan modification that never materialized. The negotiator at Bank of America said she needed investor approval to postpone the sale, which was news to me because this has not been protocol in the past.

But short sales change daily. That's what keeps us short sale agents on our toes. Sure enough, when pressed, Bank of America said its policy has changed. Now, it says, investor approval is required prior to postponement. Regardless of this policy change, we were able to postpone the auction. Minutes before it was auctioned off on the courthouse steps.

There is not a lot of black-and-white policy at Bank of America, it seems. That could be good or bad. For example, I was informed a few weeks ago that Bank of America would no longer put the squeeze on sellers to apply for HAFA when a short sale is initiated in Equator. Its new policy said HAFA would be possible only prior to an offer. That lovely preapproved HAFA route in which everybody involved is ready to poke out their eyes at the end if it would make the torture stop.

We opened of couple of short sales yesterday in Equator and, sure enough, this morning I received the email that says the seller must call Bank of America to discuss HAFA eligibility. Oy.

Here is a photo sent by my friend in Texas, Jakey the Clown. She's in the center, flanked by the Hog Eye Fest Sowpremes:

I suspect you guys are thinking the title of my blog this morning is a punchline, but it's not. I really did throw a big chunk of loose change into Bank of America stock. That's how much I love Bank of America and closing Bank of America short sales. Believe it. It's true. As a Sacramento short sale agent, I close a lot of Bank of America short sales.

In fact, I have begun to get my clients preapproved in advance. I haven't actually had the pleasure of doing a Cooperative Short Sale yet because all of those clients have qualified for the HAFA short sale. Let me say again that there are two types of a HAFA. You've got your Preapproved HAFA (which is the best) or the regular HAFA. So, don't confuse them because they are very different.

At first, when I heard about the HAFA program, I didn't think anybody would qualify for it. Yet, many clients do qualify. I also didn't think I would ever do a Preapproved HAFA because I didn't like the bank picking the price. So often those BPOs are way off mark. But then I figured out it doesn't matter too much as long as my sellers price the home the same way the bank would do it. I often hit that list price right on its tender little head. I'm so danged close, all the bank has to do is add a weird 3-digit to the back end of that price.

I love Bank of America short sales.

Processing and negotiating a Bank of America HAFA short sale is way easier than, say, a Chase HAFA. But none of them is impossible. You've just got a few rules to follow, guidelines to adhere to.

I suggested to my managing broker this morning that she recommend to Lyon agents they get certified for HAFA, get the CHS designation. But they also need to do more than that. They need to focus on the webinar, not sleep through it or answer emails or play with the dog. Actually pay attention and take notes. It's fast paced. I am a Certified HAFA Specialist, and I'm very glad that I took the time to get this designation. It's been extremely helpful. But I'm also kind of person who listens between the lines. You need that for HAFA.

So why did I buy a bunch of stock in Bank of America? The bank that so many wrongly love to hate? Because I see Bank of America is doing all of the right things to correct mistakes, and it is making intelligent decisions. Plus, its stock, BAC, is under $11 a share. When other people bail, I jump aboard. But, hey, what else would you expect from a real estate agent who in 2005 chose short sales as her focus?

I put my money where my mouth is.

Bank of America short sales tend to dominate the bulk of my short sales in Sacramento. It would not astonish me to discover that Bank of America holds a mortgage on 3 out of every 4 underwater homes in the country. Especially since B of A picked up all those Countrywide subprime mortgages. My first Bank of America short sale was in 2006, so I guess I've been working with B of A now for about 6 years.

This qualifies me to say that if you are a Sacramento short sale agent, you had better become proficient at understanding how Bank of America short sales work if you plan to stay in business as a short sale agent. But so many agents just list a short sale and throw paperwork at the bank with no clear understanding of what they are attempting to do. They give Bank of America short sales a bad name. How do I know this? Because grumpy sellers who have listed with some other agent often call me to complain about their agent.

One particular seller called me a few weeks ago and left me a voice mail. When I returned her call, she asked, "Did you understand everything I said?" I replied, "Let me recap it for you. You called me a couple of years ago to pick my brain about short sales; you then listed with some guy who can't sell your home, and now you are sorry and are calling me back?" The seller gulped. Hey, it was the truth.

The basic thing with a Bank of America short sale is the seller most likely would prefer to be released from personal liability. Otherwise, why endure the pain? Sellers don't want to go through the short sale and end up with a deficiency judgment, at least not in California. Florida and other states are different from California, and I am speaking strictly about California because I work in Sacramento.

There are a variety of faces to a Bank of America short sale, from HAFA to Cooperative to Fannie Mae, and so forth. I don't have time to talk about all of those today. Today, I'd like to focus on the 3 basic types of Bank of America short sales and how the possibility of a release of personal liability falls primarily on the type of loan secured to that property. If you've done a cash-out refinance, the likelihood that Bank of America will release you is pretty much nil -- unless you are willing to make a huge seller contribution. For example, investor clients who owned a rental had 2 refinanced loans with Bank of America. They paid about $30,000 to get a personal release of liability. Before you say, "Whoa, what the?" -- realize the forgiven debt was more than $200,000.

If your loan is a refinance for rate-and-term, you've got an argument to present to Bank of America. If you have two loans on that short sale refinance, your argument is weakened, and you better start looking in your pockets for spare change.

If your loan is purchase money, and you qualify for a short sale due to a hardship, the odds are Bank of America will release you without much of a fight. Every so often, though, we can get stuck with a negotiator who doesn't understand California law. I had one of those short sales close yesterday. A lawyer was negotiating it. The lawyer's loss mitigator copied me on an email to the client that said the lawyer had written a letter to Bank of America. As a result, the bank still refused to release the seller from liability, so it was time to talk with legal about options.

Oh, for the love of God. This poor seller was not going down that river. I asked the lawyer's loss mitigator to contact the executive short sale department at Bank of America and wrote to that department myself. Within days, we received the short sale approval letter with a release of liability. I have no doubt that the lawyer's loss mitigator might have given up the fight if I hadn't stepped in. If I feel my client has a strong case, I don't give up. I fight. But you've got to know how Bank of America works and carefully choose the hill on which you want to die.