Austin, TX · Member since 2014 · 22 posts · 0 votes
As the seller, both primary and HELOC are with BOA and we are due an answer in 7 days (according to BOA/Equator).
Question: What could prevent Freddie from NOT accepting at this point? Any insight/intel would be appreciated.
Timeline:
415K 1st/HELOC
290K Buyer 1st Offer
340K BOA Counter
295K Buyer 2nd Offer
Appeal with Comps
295K BOA Accepted Offer
Waiting on Freddie, per BOA/Equator: " Thank you for your interest in a short sale. We have been unable to reach a decision within [58] days as we originally stated because "[We are still awaiting a decision from the investor on your loan]" we appreciate your continued patience as we process your request. We will let you know whether or not your request for a short sale has been approved by [06/08/2016]."
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
10y
How much is the 1st, and how much is the heloc? The heloc (2nd) is not with Freddie, and the investor on the heloc may not accept what Freddie is offering them.
Paradise, CA · Member since 2015 · 1k+ posts · 871 votes
10y
Originally posted by @Account Closed:
320K 1st
95K HELOC
Both loans are with BOA - and the unit is with Freddie. Would that mean both loans Freddie?
No. Freddie only purchases first liens. BofA either owns the HELOC or services it on behalf of another owner. Only a week longer to wait it sounds like.
Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
10y
Here's what trips up short sales with HELOCs.
Suppose it's a $500k home.
Suppose there is a 1st for $550k and a HELOC for $100k.
Home sells for $550k.
1st loan is paid off, all but the last $50k. 1st lender is out $50k.
HELOC, $0 of it is paid off. The HELOC lender lost literally everything. So they say "no."
So why would a HELOC lender EVER sign off on a short sale?!
Because the 1st lender works something out with them.
Suppose HELOC lender asks the 1st lender to kick $90k towards the HELOC. Great, now the HELOC only lost $10k!
Oh, but wait, now the 1st lender is out $140k on a home that from their POV was only underwater $50k... "screw that, we may as well foreclose and auction it!" So now the 1st lender is going to say "no."
And so on, around in circles, two banks negotiating at the speed of a bank, each trying to cut their own losses, and both perfectly willing to foreclose... ON YOU... if they can't work it out to find a way that short selling is better than foreclosure.
Each round of negotiations and submission for internal approval for both lenders, is the same waiting time as a single submission for a house with a single mortgage. Except there might very well be five or ten rounds of offer and counteroffer...