Short sale limbo. I recently listed a property a month ago, I quickly received an offer on the property within 2 weeks of listing the home. I quickly made contact with a negotiator I have worked with before in the VA department for Bank of America that has been a help in the past. I ask if they would take at a new Bank of America short sale I had an offer on that was VA. The negotiator took a look and told me what they would need to get this processed. I already had that all on hand and promptly turned it into the negotiator the only thing I didnt yet have was a second lien holder approval letter which was asked of me from the negotiator.
I got in contact with Key Bank the second lien holder and I had a contact for a negotiator there so I ask what they needed and quickly sent all that over to them they told me they would need an approval letter from the first before they could issue an approval letter. I went back to the first lien holder and stated what the second had said about needing an approval letter from Bank of America before they at Key Bank could issue one. Bank of America stated it sounds like we have an uncooperative second lien holder and we will have to move this file to foreclosure. It amazed me that this negotiator would jump right to that as this negotiator had been the best I have worked with and had tried and cared about doing everything possible to get these deals together as the negotiator realized this is a real family on the other side that owns this home that is trying to not be foreclosed on. I have been told by this negotiator at Bank of America that to send in the complete package to the investor that holds this note on the property they would need to have the approval letter. The Bank of America negotiator went out of their way to state on Bank of America letterhead that they are willing to give the max allowed 3 K under their VA guidelines that they can do on a VA to pay the second.
The Key Bank negotiator wouldn't answer the calls from Bank of America's negotiator and told me after my multiple calls that Key Bank would not accept this to be able to issue an approval letter. I talked with a supervisior at Key Bank and was told this was their directive from the legal department at Key Bank with any first lien holders out there they must issue an approval letter before Key Bank they stated an OCC violation and I ask which one that might be they would not state which it was and said you can look it up I am not going to waste time on a deal that sounds like it is not going to go anywhere Key Bank will look at giving an approval letter after the first sends their approval. Is anyone else having this problem with Key Bank?
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Talk about a Catch 21 - you need to escalate this to someone at the VA so these banks stop this merry go round. Good luck!
Evelyn- That does look to be the next step. I have added an LOA for the title company and attorney office that is handling this short sale with me and they are drawing a letter to Key Bank to go over and highlight their choices.
Boy Brandon, it sounds like Bank Of America is telling you NO in a roundabout way. Keep pounding them... it works.
You should start collecting as many of the supervisor emails as you can get. When a situation like this occurs... email EVERYONE asking for action. You'll usually get an escalation when you need one.
Good Morning Brandon, thank you for sharing the information on the experience.
How did this one end up going? I have a new short sale with Wells Fargo(1st) & Key Bank(2nd)(for a pool). Thank you.