BofA Offers Monetary Incentive to Short Sale Applicants

Distressed borrowers looking to avoid foreclosure will certainly be surprised to learn Bank of America is willing to pay as much as $20,000 if the property is sold via a short sale by August 31, 2012 through its Florida Enhanced Short Sale Relocation Assistance program. Proposals should also be submitted before November 30 for the homeowner to qualify.

A short sale has become the “go to” option of most troubled borrowers, particularly those who are suffering from underwater mortgages for the following reasons:

  1. It allows the sellers/homeowners to suffer less damage to their credit scores

  2. It allows them to pay off their mortgage debt and and become virtually debt free especially if the lender agrees not to pursue a deficiency judgment

  3. It is generally faster to conduct a short sale these days compared to a foreclosure, which can last as long as 611 days based on the national average.

Lenders like BofA have been more inclined to accept short sale proposals because of the bigger cost associated with processing a foreclosure case. In addition, most lenders are suffering from a huge backlog of foreclosure cases, referred to as shadow inventory, due to their decision to carefully check each case so there would be no more allegations of wrongful foreclosures.

Interested homeowners should take advantage of such opportunity especially since it is unheard of for lenders to offer incentives. It would be smart to work with a short sale Realtor to make sure all requirements set by the lender are met and delays can be avoided. By submitting a well-prepared proposal, you will likely increase your chances of getting approved before the deadline. Also, speak with your lender about this program so you fully understand all the policies, restrictions and other guidelines.