In October of last year I wrote about a program Bank of America was testing in Florida that they hoped would encourage home owners to sell their homes in a short sale instead of waiting for the bank to foreclose. There were 11,000 home owners who agreed to participate in the pilot program but less than 1,000 sales closed according to The Palm Beach Post.
The Short Sale Relocation Asssistance Program offers financial incentives of $2,500 to $30,000 for owners to sell their homes in a short sale. The Palm Beach Post reported that the average payment to those who sold their home in a short sale during the trial period was approximately $12,000. The amount of the payment is determined on a case by case basis using a calculation that includeds the value of the home, amount owed and other factors.
To qualify for the program, borrowers/sellers must must obtain a pre-approved sales price from Bank of America before submitting a purchase offer to the bank. Short sales must be initiated before the end of 2012 and close by September 26, 2013.
Here is the full press release from Bank of America:
CALABASAS, Calif. – Adding to its foreclosure prevention initiatives, Bank of America has launched a nationwide program that offers delinquent mortgage customers increased assistance with relocation expenses – between $2,500 and $30,000 – at the completion of a qualifying short sale.
“Bank of America is committed to providing alternatives to foreclosure whenever possible,” said Bob Hora, home transition services executive for Bank of America. “This program can help customers make a planned transition from ownership when home retention options have been exhausted or they have made a decision not to keep the home.”
The short sale relocation assistance program builds on the bank’s already robust short sale initiatives, which led to 200,000 completed short sales in the last two years and another 30,000 in the first quarter of 2012. This program is based on a similar incentive offer that Bank of America tested in Florida last year.
To qualify for the enhanced relocation assistance payments under the new program, the seller must work proactively with the bank to obtain a preapproved sales price prior to submitting a purchase offer to the bank. A short sale must be initiated by the end of this year and close by September 26, 2013, to be eligible for the payment. Qualifying short sales that have already been started but have not closed may be eligible for the relocation assistance.
The amount of assistance provided under the new program will be determined on a case-by-case basis using a calculation that includes the value of the home, amount owed and other considerations.
Initially, the program will be offered on mortgages that are owned and serviced by Bank of America.
While available nationally, Bank of America anticipates greatest response to the program will come from borrowers in California, Nevada, Arizona, Florida and other states hardest hit by the economic downturn and falling property values.
Customers who believe they may be eligible for Bank of America’s short sale relocation assistance program may contact program specialists at 877.459.2852.
To help homeowners understand the short sale process and other foreclosure avoidance programs, Bank of America encourages them to visit the Home Transition Services website at www.bankofamerica.com/hometransition.