Bank of America announced this week it will accept back-up offers on short sales and will allow the back-up offer to take over if the first buyer does not complete the transaction, without requiring the process to start again.
Under this new guidance, agents will no longer have to initiate a new short sale in Equator if the original buyer walks away from the transaction. Instead, the agent can continue with the original transaction in Equator and work with the same short sale specialist. The file will remain open and the paperwork that has been submitted will remain active. However, the buyer’s qualification and the offer price will need to be reviewed again if a back-up offer is used.
This new process applies only if there’s an available back-up offer when the original buyer does not follow through with the transaction. If a back-up offer is not ready to be submitted, the short sale will be declined. In that case, agents should return to marketing the property and initiate a new short sale in Equator once another offer is received.
In December, C.A.R. leadership met with representatives of Bank of America and asked the lender to accept back-up offers without starting the process over again. C.A.R. also has raised this issue with Fannie Mae, Freddie Mac, and Wells Fargo, and hopes they will follow Bank of America’s lead with this process.
Reprinted from C.A.R. Newsline
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