So far, only 60 take up Bank of America on short sale incentive

Only 60 Floridians have received cash from a Bank of America program that pays up to $20,000 to homeowners who sell distressed properties in a short sale.

The lender still expects thousands more in the Sunshine State to collect the money before the pilot program ends in August. Bank spokesman Richard Simon said it's too early to judge the results.

"There are some encouraging signs in this early stage," he said. "This is just the start of the process."

Several Realtors and title agents around Tampa Bay said deals are in the pipeline, but none has finalized any of the sales.

Bonnie Fagoh, an agent with Century 21 Beggins Enterprises in Apollo Beach, is representing a seller who'll collect $15,000 on Feb. 3. The seller listed the home in early December and quickly landed a cash buyer on the $160,000 deal.

"It was a very smooth process," she said. "Everything is being worked out."

Steve Capen of Keller Williams Realty in St. Petersburg gained 15 listings from the program, but none has closed yet. The bank hired a vendor to process all the paperwork submitted from home­owners and real estate agents. Capen fears the cash incentives could be reduced or disappear at closing because communication with the vendor is difficult.

"They rolled out this program, but nobody knows the guidelines," he said.

Short sales are on the rise in the bay area, and real estate agents say some lenders have been closing the deals in 45 to 60 days instead of a year or longer.

Beth Cromwell, a short sale specialist at Hillsborough Title, cautioned that short sales are complicated and take several months to finalize. The firm is handling several Bank of America deals.

"I believe the program is working," she said. "We just have to give it more time."

Bank of America had targeted 20,000 of the 1.1 million mortgages it services in Florida.

In the program, qualified homeowners would get 5 percent of the unpaid mortgage balance as of August 2011, with a minimum payout of $5,000. And so on up to a maximum of $20,000. The sales price does not impact the payout.

By offering the incentive, Bank of America saves attorney fees, court costs and property taxes by avoiding foreclosure. It also speeds the process of getting bad loans off its books and gets the properties back on the market faster.

To sweeten the deal further, the lender said it would consider waiving the deficiency on the mortgages, which would allow homeowners to sell the house for less than they owe for it without having to make up the difference to the bank.

The bank tested the program only in Florida because of the higher foreclosure rates.

Mark Puente can be reached at mpuente@tampabay.com or (727) 893-8459. Follow him on Twitter at twitter.com/markpuente.

So far, only 60 take up Bank of America on short sale incentive 01/26/12 [Last modified: Thursday, January 26, 2012 10:16pm]

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