Thursday, April 26, 2012

BofA's Plan To Work Around Florida Foreclosure Process Results In 'Walking Money" Averaging $12K In Delinquent Borrowers' Pockets

In West Palm Beach, Florida, The Palm Beach Post reports:

  • Bank of America's payoff to Florida homeowners who do a short sale instead of dragging out a foreclosure has averaged $12,000 per deal and helped close 678 contracts statewide since it debuted in October.
  • The Florida-only plan originally targeted 20,000 homeowners with incentives of between $5,000 and $20,000 to forgo the more than two-year foreclosure process and leave their home in "broom swept" condition for a new owner.
  • Bank of America spokesman Rick Simon said the Charlotte, N.C.-based company remains "enthused" about the pilot program, which generated 3,900 purchase offers and 11,000 verbal agreements from customers who said they were interested in participating.
  • "We've quietly done a little experimentation with a similar plan in one of the non-judicial states, but we are not to the point of announcing a major expansion," said Simon, adding that monthly short sale volume has more than doubled this year. "Of particular note is the response from 'hand-raisers' who heard about the program and asked to be included without us reaching out to them."
  • To participate, purchase offers had to be submitted by mid-December. Sales must close by Aug. 31. [...] Florida was a testing ground for Bank of America because of the state's high foreclosure rates. Wells Fargo and JPMorgan Chase have similar plans.

For more, see Bank of America's payoff to Florida homeowners draws 678 short sales (Thousands more homeowners pursue incentives of up to $20,000).

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