Live-Orange County: Another Bank of America Short Sale Success by IML Real Estate

Another Bank of America Short Sale Success by IML Real Estate

When "Just Sold" equals relief! Homeowners considering a short sale who have their loan(s) with Bank of America often ask me what the short sale approval letter looks like and what provisions and requirements it will contain. Well here is another Bank of America short sale we recently completed:

Much to the relief of our client we closed escrow on this Bank of America Short Sale on October 20th, 2011.  Both the 1st mortgage and the 2nd mortgage were serviced by Bank of America.  Some important points regarding this short sale:

1. Deficiency Rights Waived:
1st Mortgage: "The owner of your mortgage note... waive their right to pursue collection of any deficiency following the completion of your short sale and your debt is considered settled." When SB 931 took effect in January of 2011 1st mortgage deficiency judgments were prohibited for short sales of all 1-4 unit homes regardless of whether the loan was purchase money or refinanced and regardless of whether the home was owner occupied or an investment property (rental). 

2nd Mortgage: Most imortantly on this successful short sale the deficiency rights of the 2nd mortgage were also waived; "Any deficiency balance will be waived...".  Although legislation passed in California in July of 2011 which eliminated a lender's right to pursue deficiency judgments on 2nd and 3rd mortgages it only pertained to loans which were A. secured on residential property, B. purchase money (the loan was utilized to purchase the home), and C. the property was occupied by the borrower.  In this particular transaction the property was a rental property and the loan was not original purchase money but rather from a refinance.  It was, therefore, vital that a short sale approval that waived the lender's deficiency rights was obtained.

2. NO Promissory Note Required   3. Over $160,000.00 Of Mortgage Debt Forgiven

Bank of America Short Sale Approval 1st Mortgage

Bank of America Short Sale Approval 2nd Mortgage