Cooperative Short Sale

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Is a Cooperative Short Sale right for you?

If the loan was evaluated for a modification and did not qualify or if you were unable to complete the modification trial, a Cooperative Short Sale may be an option to settle the home loan debt to prevent foreclosure. Plus, you may qualify for assistance with relocation costs.

Eligibility

You may be eligible if:

  • The loan is owned by Bank of America or other participating investors
  • The balance owed on the home is more than its current value
  • You're experiencing financial hardship such as reduced income, medical expenses, or divorce
  • You're unable to modify a current home loan or don't wish to remain in your house due to other circumstances, such as a job relocation

Next steps

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If the loan was already reviewed for a modification and did not qualify, you may be able to start the short sale process right away. However, in most cases, we are required to evaluate whether the loan is eligible for a modification or other home retention options before we can proceed with any requests to pursue a short sale.

If you are eligible for a short sale, during the initial call, we'll discuss your current financial situation, confirm your eligibility and make sure we have all the needed documentation. You'll also be connected with a Customer Relationship Manager who will work with you throughout the process.

Approval

If we authorize you to start the short sale process, we'll work to gain approvals. Even if you're pursuing a short sale with us, in most cases there's a third party who has ownership of the loan. We'll need their approval in order to finalize the short sale. A valuation of the property will be performed at no cost to you. Then you'll receive a valuation letter with the recommended list price for the property and the next steps.

for sale

Typically, you'll have up to 120 calendar days to sell the house at the price in the valuation letter.

You're required to work with a licensed real estate professional. We recommend working with a real estate agent experienced in short sales who understands the process.

Offer

Once you receive an offer, your real estate agent will submit:

  • A copy of the executed sales contract and all additional documents
  • The buyer's proof of funds or pre-approval or commitment letter on letterhead from the buyer's lender
  • An update on the status of any additional liens on the property

We'll review the information and get back to you with a decision within ten business days. Your agent must submit documents on time and respond quickly to any counteroffers.

Closing

If we accept the offer, you'll receive:

  • An approval letter listing our requirements to complete the sale
  • Details of the sale of the house
  • A set of documents that must be signed, notarized and returned to us

In order to complete the sale, we must receive all documents by the deadline that we provided in the approval letter.

At the closing, you could receive up to $3,0001 to help with moving, rental and other relocation expenses. For tax purposes, relocation assistance paid at closing is considered income. Please consult a tax advisor for more information on how this could affect you.

Once the sale is finalized, the mortgage and any other loans against the house are settled from the proceeds of the sale.

If we forgive any amount of mortgage debt, there may be possible tax consequences. Please consult a tax advisor for more information about how this could affect you.

We'll report the sale to the major credit reporting agencies as completed for less than the amount owed.

What if I'm not eligible or get declined?

It may be possible to sell your house through a traditional short sale. If that's not an option, you may talk with your Customer Relationship Manager about a deed in lieu of foreclosure. This allows you to transfer the title or ownership to the servicer of the home loan.

Call us

Monday through Friday
8 a.m. - 8 p.m. Eastern

Help is available in English, Spanish and many other languages.

1 The relocation assistance payment is calculated based on the appraised value of your property and the program rules. The total amount will be no more than $3,000, if you qualify. The payment will be delivered after the closing if you comply with all terms and conditions of the program, which include but are not limited to the following: a valuation of the property must be completed, and you must satisfy all subordinate liens and provide clear title for the property. If you are still responsible for a deficiency balance after the sale, you should be aware that this relocation assistance will increase that deficiency since it reduces the amount available to apply towards a mortgage debt. If you do not comply with all terms and conditions of the program, you will not receive the relocation assistance payment. The amount of any relocation assistance will be reported to the Internal Revenue Service (IRS) on the appropriate 1099 Form or Forms. We suggest that you contact the IRS or your tax preparer to determine if you have any tax liability. In order to receive the relocation assistance, the sale of the property must close by the closing date in the short sale agreement. Bank of America reserves the right to change or alter the relocation assistance at any time.