How to get B of A to waive deficiency?

"BAC Home Loans Servicing, LP and/or its investors may pursue a deficiency judgment for the difference in the payment recieved and the total balance due, unless agreed otherwise or prohibited by law, if the short sale closes on the loan referenced above."

And I know that they, or a collections company, can do this. You are only protected from this on a foreclosure and with a non-recourse loan. There is a myth that you are also protected in a short sale but you are not. (I have a non-recourse loan, first only, and always owner-occupied property.)

I am trying to get B of A to drop their clause and to waive their right to pursue a deficiency, but it is slow going trying to find someone empowered to do this.

Has anyone here done this successfully? Please provide me your suggestions for how to do so.

Thank you.

Edited: 06/26/2010 at 10:18AM

Scott Hubbard

Rehabber · Tucson, Arizona

1,031 posts
11 awards
57 influence

Oct 30 '09, 09:27 AM

Originally posted by Jeff A

Can anyone suggest the most effective way to get B of A to waive their right to pursue deficiency?

I received a short sale approval from B of A with the clause saying they can pursue the deficiency:

"BAC Home Loans Servicing, LP and/or its investors may pursue a deficiency judgment for the difference in the payment recieved and the total balance due, unless agreed otherwise or prohibited by law, if the short sale closes on the loan referenced above."

And I know that they, or a collections company, can do this. You are only protected from this on a foreclosure and with a non-recourse loan. There is a myth that you are also protected in a short sale but you are not. (I have a non-recourse loan, first only, and always owner-occupied property.)

I am trying to get B of A to drop their clause and to waive their right to pursue a deficiency, but it is slow going trying to find someone empowered to do this.

Has anyone here done this successfully? Please provide me your suggestions for how to do so.

Thank you.

Jeff-

This is a boilerplate provision in the approval letter that they use for all states. This provision allows them, in states where they can file for a deficiency judgment, to file against the borrower.

You need to get them to add language into their approval letter that says the "deficiency is considered settled" or "fully settled". If this clause is added into the approval letter and the sort sales is transacted, then there is no longer any deficiency to pursue.

BOA is very difficult to deal with on this issue. You must remind them that your documenting very phone call and their resistance to deal with this issue will lead them to having to foreclose. I sometimes remind them that they are on the taxpyer dole and that you have no problem contacting your congressman and pass along their contact infomation.

The BOA negotiators no longer have the authority to change the terms on the approval letters. It was not more than 3 months ago I could get certain provisions changed, now that is nearly impossible.

You need to escalate in order to get any action. Document every phone call, and every conversation. Make sure the person on the other end is also recording ewvery thing you say as well.

Hang in there, persistance does pay off.

Good Luck!

Edited: 06/26/2010 at 10:19AM

Jeff A

10 posts
1 award
50 influence

Oct 30 '09, 09:46 AM

Scott, thank you for your helpful reply.

Can you please suggest who I should escalate my request to? I am trying to talk with the negotiator and with their supervisor. Who else can I try and involve?

Your advice is appreciated.

Jeff

Edited: 06/26/2010 at 10:19AM by Jeff A

Jeff A

10 posts
1 award
50 influence

Oct 30 '09, 09:46 AM

...

Edited: 06/26/2010 at 10:19AM by Jeff A

Jeff A

10 posts
1 award
50 influence

Oct 30 '09, 09:46 AM

...

Edited: 06/26/2010 at 10:19AM by Jeff A

Scott Hubbard

Rehabber · Tucson, Arizona

1,031 posts
11 awards
57 influence

Oct 30 '09, 09:59 AM

Originally posted by Jeff A

Scott, thank you for your helpful reply.

Can you please suggest who I should escalate my request to? I am trying to talk with the negotiator and with their supervisor. Who else can I try and involve?

Your advice is appreciated.

Jeff

There are policies here that disallow me to post contact information on this forum. I will add you as a colleague so you can PM me.

Edited: 06/26/2010 at 10:19AM