Short Sale Consumer Alert- BofA & Re/Max Are Now Short Sale "Partners"!
We've all heard the rumors for months about banks "partnering" with some of the larger real estate brokerages. In doing so, the servicing lenders provide these "partners" with the contact information of clients who are 30/60/90 days late on their payments. The agents, in turn, are to call these prospects and introduce themselves as "short sale experts" that are partnered with the borrowers lender. BofA has officially rolled out a program called the "Short Sale Alternative Right Party Contact Program" for all Re/Max agents who do the following:
1. Take a 10 Question Test
2. Hold a Distressed Property Certification (e.g., CDPE, 5Star, SFR)
That's it! Take an 8 hour course on short sales and pass a 10-question test, and you are now a short sale expert at Re/Max! Today, fellow agent Cyndi Mino emailed me a copy of this new program. I'll hit on some of the high-points that stood out to me:
1. Borrowers are automatically put into the "Cooperative Short Sale Program". As many of you know, this program is set up to benefit BofA, not the borrower. Basically, BofA tells the agent what they can sell the home for. If it doesn't sell at that price after 4 months, a deed-in-lieu is enforced, and the home reverts back to BofA. Nice Huh?
2. "Possible" $2,500 for "Customer Relocation Assistance", to help with moving and rental expenses.
3. Borrower must sign the Cooperative Short Sale Acknowledgement of Interest, Listing Agreement (with list price to be marked TBD), and Customer Agent Option Awareness disclosure forms. Gee, I wonder if these forms are in place to protect the borrower? Highly doubt it.
4. Re/Max "Escalation Tool", which gives Re/Max agents a "convenient way to connect to a team of short sale professionals who can help resolve issues that prevent a short sale from moving forward". Gee, I wonder why non-Re/Max agents aren't given this "escalation tool"?
Now for a few disclaimers at the bottom of the page:
1. Relocation Assistance payout amounts are presently under review and likely to change. Really? Do you think they'll go up?
2. I love this one, and it's in all caps...FOR REAL ESTATE PROFESSIONAL USE ONLY. THIS INFORMATION IS NOT INTENDED OR AUTHORIZED FOR CONSUMER DISTRIBUTION. Wow! Must be a great program for borrowers if they don't want details of the program released to the general public. Re/Max agents all over the country have posted the program on the internet. You can view a copy by clicking here. So much for Re/Max agents following the rules about distributing it to the public.
The blogosphere is starting to heat up with articles on this program. Most of the articles/blogs I've read are asking the question, "Is this a RESPA violation"? In this case, a certain brokerage (Re/Max) is being given personal information about a consumer. In addition, they are given a special "Escalation Tool" in order to speed up the short sale process with BofA, AND their clients could "possibly" be given $2,500 for relocation assistance. I'm not an attorney, but perhaps some of you that are could chime in.
I'd like to focus instead on the main problem that this program could create for borrowers facing a short sale. First and foremost, this program says, and I quote, "An agent's past performance may affect future allocations". MAJOR RED FLAG! I can't believe they actually put this in writing, but they did. What this is saying is, "If you, as our "Re/Max partner agent, don't follow our rules, you don't get anymore leads". Pure and simple.
So, Mr./Mrs. borrower, I ask you...Do you think that an agent who is "partners" with BofA will be looking out for your best interests, or will they be looking out for the lenders' best interests? I think the answer is obvious. Do you think that agent will bite the hand that feeds him/her?
Folks, lenders do not roll out new programs to help borrowers. They come up with these programs to increase their bottom-line. Please note, I know of many very qualified, professional Re/Max agents. This post is not intended to "bash" Re/Max in any way, shape, or form.
If/when you get a call from a "Phoenix short sale expert" that was "referred" to you by your lender, remember this blog post, and ask yourself if you think the agent will be looking out for your best interests.
Until Next Time...
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Copyright © By Bob Hertzog 2011 "Short Sale Consumer Alert-BofA & Re-Max Are Now Short Sale "Partners"!"
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