Over the years of negotiating Bank of America short sales one of the most difficult stumbling blocks has come when the value of the home is not what Bank of America or their investor seems to feel the value is.
First, let’s explain how value is determined on an Elk Grove short sale. The listing agent completes a comparative market analysis on the home prior to listing. The short sale is then listed. Once offers come in, the seller selects one to submit to the bank for consideration as a short sale. Bank of America then orders a “BPO” or Broker’s Price Opinion. A third party vendor, sometimes an agent and sometimes an appraiser, completing the BPO then inspects the property and lets Bank of America know what they feel the value of the property is. Unfortunately, these two numbers are not always in agreement and this can become a wall in the negotiation process. In the past there has not been a standarized way to argue this valuation with the bank and each negotiator seems to want something different.
Bank of America has just announced that they now have a process for these valuation disputes. This process has been taken from the Bank of America website at www.bankofamerica.com/realestateagent:
1. Tell your short sale specialist that you would like a reconsideration of the value.
2. Receive an investor-specific, easy-to-complete form from your short sale specialist that specifies all requirements for a successful value dispute.
3. Fill out the form and attach specified evidence.
4. Stay in touch with your short sale specialist for results.
5. Expect a value dispute review within 10-12 business days once all required information has been received.
Evidence Needed to Dispute a Value
When contesting a home value, make sure you have compelling evidence to support your claim. Do not reference property pricing amounts in the narrative on the form. This violates appraiser independence policy and is against industry standards. Any reference to pricing will disqualify the dispute.
Provide comparables that are recent, proximate (nearby) and similar to the property in question.
- “Recent” means sold within 90 days of the actual value document date.
- “Proximate” varies by location. In a rural area, for example, a home five miles away could be considered proximate.
- You will be able to provide additional notes to highlight characteristics of the comps.
When the dispute centers on property condition or hazards:
- Provide an itemized estimate from a licensed contractor on the contractor’s letterhead.
- Provide photos to illustrate the repair, condition issue or hazard you want to highlight.
This seems as though it should simply any valuation dispute we might have! At least it finally gives us a process to follow when we need to dispute a BPO value with Bank of America.
Use our quick and easy site to get an instant value for your home! For a more accurate value, or to talk about getting your home on the market, give us a call at 916-405-5737 today!