ss_commondocerrors.pdf

How you can avoid common document errors that delay short sales

Your guide to faster short sales

November 2013

This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. 2013 Bank of America Corporation.

Required short sale documentation

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When you initiate a short sale request by submitting an offer through Equator, you must have the following documents completed correctly:

Signed Purchase Contract with Bank of America Buyers Acknowledgement and Disclosure Form*

Signed Bank of America Short Sale Purchase Contract Addendum & Real Estate Licensee Certification*

Estimated HUD-1 (prorated for an estimated closing date at least 60 days from submission)

Signed Bank of America Third-Party Authorization Form*

Signed Borrower Election Form* Needed if the customer is choosing to proceed directly to a short sale evaluation and not be evaluated for a modification at this time

If these documents are not completed correctly, the processing of your short sale may be delayed until the errors are addressed. The following pages provide examples of the most common errors that prevent these documents from being accepted and may delay your short sale request from moving forward.

*Bank of America forms can be downloaded at bankofamerica.com/shortsaleagent.

How to properly complete short sale documents Third-Party Authorization form


Completing the short sale Third-Party Authorization form

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You must use Bank of Americas Third-Party Authorization Form.

You may download the form from the Short Sale section of the Agent Resource Center at bankofamerica.com/shortsaleagent.

Forms may be updated periodically. Always download a fresh copy of the form when needed to ensure that you have the latest version.

NonBank of America third-party authorization forms will not be accepted.

You may complete this form electronically and save the completed version. Only signatures and their accompanying dates must be handwritten.


Third-Party Authorization form

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Page 1: Borrower(s) Acknowledgment

At the top of the first page, fill in the following information:

1. Loan number

2. The typed/printed names of the borrower and co-borrower (if any), and names should appear exactly as the names appear on the monthly billing statement

3. Property address should appear exactly as the address appears on the monthly billing statement; if you type this in electronically, the address information will also auto-populate on Page 2 where needed

4. The typed/printed name of each designated representative; the names of the first two representatives will also auto-populate on Page 2

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Third-Party Authorization form, continued

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Page 1: Borrower(s) Acknowledgment

At the bottom of the first page:

1. Borrowers signature and date (must be handwritten)

2. Co-borrowers signature and date, if applicable (must be handwritten)

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Page 2: Designated Representative Acknowledgment

On the second page, complete the following information:

1. Property address (will auto-populate if completed on Page 1)

2. The typed/printed name of each designated representative (will auto-populate if completed on Page 1)

3. Each designated representatives company name

4. State licensing information for each designated representative

5. Each designated representatives handwritten signature and date

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Page 2: Designated Representative Acknowledgment

On the bottom of the second page, complete the following information if the designated representative(s) will use support staff to assist with short sale activities:

1. The typed/printed name of the relevant designated support staff member(s)

2. The name of the company that employs the support staff member

3. The name of the designated representative who will be assisted by the support staff member

4. Each designated representative's handwritten signature and date

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Question: If a real estate agent hires an outside company or vendor to assist his/her office, can they be added to the Third-Party Authorization Form as support staff?

Answer: No. Only support staff (employee or contractors) who are directly under the supervision of the licensed attorney or real estate agent may be added.


Third-Party Authorization form final steps to completion

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1. Print the completed form.

2. Save an electronic version for your files.

3. Have the designated representatives and their relevant support staff members (if any) sign their names and handwrite the dates next to their signatures.

4. Scan the completed form with signatures and upload it as a PDF to Equator.

Note: You could also print out a blank form and print/handwrite all the necessary information, rather than completing it electronically. The option to complete it electronically is for your convenience and greater legibility.

How to properly complete short sale documents Borrower Election Form and IRS form 4506-T


Borrower Election Form

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Short sale approval cannot be provided without the fully executed Borrower Election Form for customers who have chosen to bypass home retention assistance and proceed directly to short sale evaluation.

Each borrower must sign.

A delay may occur if we receive incomplete or incorrect forms.


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Common 4506-T errors

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For more information about the 4506-T, visit irs.gov.

Homeowner(s) must fill out the form exactly as the information appears on their tax return. Mistakes occur if:

1. Tax returns were filed jointly, but spouses information is not included on the 4506-T. (If divorce occurred following a joint tax filing, we still need ex-spouses information on the 4506-T.)

2. Tax returns were filed separately but only received one 4506-T. Each borrower who filed separately must provide an individual 4506-T.

3. Signature(s) does not match most recent tax return.

4. No date shown on the signature line.

5. Seller included middle initial on tax return, but failed to include middle initial on form.

How to properly complete short sale documents Bank of America Short Sale Purchase Contract Addendum


Bank of America Purchase Contract Addendum

The Bank of America Short Sale Purchase Contract Addendum is to be executed by all sellers, buyers and agents. Failure to provide a fully executed addendum may delay the short sale process and may result in the decline of the short sale offer.

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Common reasons why this form may be rejected:

1. Missing all sellers and/or all buyers printed names.

2. Buyers names do not match the names on the Purchase Contract or the HUD-1.

3. Missing the date that indicates when the addendum was completed.

4. Missing the date when the Purchase Contract was executed.

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Bank of America Purchase Contract Addendum, continued

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5. Line 5 of Page 1 is not completed. It is mandatory that you complete this section.

Indicate the number of days before or after closing that the seller agrees to vacate the property.

If the property is already vacant, use N/A or Vacant.

If the seller is vacating on the day of closing, use zero.

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Bank of America Purchase Contract Addendum, continued

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6. Missing the signatures of buyers and/or sellers. Everyones signature must be included.

7. Missing the printed name of the sellers agent.

8. Missing the printed name of the buyers agent.

9. Missing the signature of either the sellers agent, the buyers agent or both.

10. Missing the state license number of either sellers agent, buyers agent or both.

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How to properly complete short sale documents Purchase Contract


The Purchase Contract

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The Purchase Contract is to be executed by all sellers (even if not the primary seller), buyers and agents. Failure to provide a fully executed Purchase Contract/Purchase Addendum may delay the short sale process and may result in a decline of the short sale offer.

Purchase Contracts are state-specific.

The example shown here may not apply to all state-specific Purchase Contracts, but the key concepts of completing the Purchase Contract fully and accurately apply.


Common Purchase Contract errors

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Common reasons for the Purchase Contract to be rejected:

1. Problems with the buyers and sellers names:

Not consistent with the HUD-1 that was submitted.

Nickname used instead of actual name (Bill rather than William).

Sellers name reflects Estate of and no death certificate, executor of estate or power of attorney was provided.

If records show names with middle initials or suffix (Sr., Jr., etc.), include them on contract.

Include the actual seller name. Owner of Title is not acceptable.

2. The date is not included.

3. Property address does not match HUD-1 or Bank of America records.

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Common Purchase Contract errors, continued

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4. Property address is missing from all applicable pages.

5. Offer date is missing from all applicable pages.

6. Missing the initials of both buyer(s) and/or seller(s) on each contract page, where applicable.

7. Missing initials of both buyer(s) and seller(s) when there is a change made on the contract (to purchase price, close of escrow date, etc.) and addendum is not provided.

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10. Missing signatures of all buyers and/or sellers, including ex-spouse if divorced.

11. Failure to include the printed name as well as the signature of the seller.

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8. Buyers, sellers and agent names not legible.

9. Failure to include the printed name as well as the signature of the buyer.



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12. Agent information is missing (license number, address, phone, email, etc.)

13. Agents signature is missing.

14. Agents names are not legible.

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Avoiding delays

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By using these tips and completing the documents you upload to Equator correctly, you can help ensure that your clients short sale moves as smoothly as possible through the short sale process.


Lets work together

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By working together, we can make the short sale process more understandable and efficient, and help your clients have a better experience.

Additional resources For real estate professionals For homeowners

Agent Resource Center Home Transition Guide Community Resource Directory

Short Sale Customer/Agent Care: 1.866.880.1232

During the short sale process, loan servicing may be transferred to a different loan servicer. Servicing refers to collecting principal, interest, and escrow payments, if any, as well as sending monthly or annual statements, tracking account balances, and handling other aspects of the loan. We may assign, sell, or transfer the servicing of a loan at any point while the loan is outstanding. Your client will be given advance notice before a transfer occurs. Depending on the status of the short sale when the servicing of a loan is transferred, the new servicer may not be required to accept the terms and conditions of a short sale. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. Bank of America, N.A., Member FDIC. Equal Housing Lender. 2013 Bank of America Corporation. C34070-4 PRES-10-13-0134 11-2013

Documents

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