Profile picture for candyland123

short sale owned by investor

Hi - I made an offer on a home which has only one loan from BoA. The selling agent says that it is an investor who owns the mortgage. If the current home owner is paying his mortgage to BoA, wher edoes teh investor come in picture?  

Apparently, BoA has approved the short sale but the final decision lies with the investor. Is it possible that the investor can decline the short sale?  Why doesn't investor work directly with the selling agent etc?
  • May 28 2012 - Sacramento
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Answers (3)

This is typical with Bank of America short sales. In this particular short sale, it would appear that Bank of America does not have delegated authority, so it cannot approve this short sale without obtaining investor approval. Bank of America is a servicer for this loan, and the loan is actually owned by somebody else. Bank of America collects the mortgage payments and disburses the payments to the investor, which can be an investment group, a government-sponsored entity such as Fannie Mae or Freddie Mac, an individual or a host of other groups.

Without delegated authority, the investor must have the final say on the short sale, but I will add that I have never seen an investor reject a short sale after Bank of America has approved it, and I've closed hundreds of short sales in Sacramento. But there is always that one exception to the rule.

Elizabeth Weintraub
Broker-Associate #00697006
Lyon Real Estate
Sacramento Short Sale Agent
  • May 28 2012
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Profile picture for nwhome.us
Most of the major institutions resell their loans; they put themselves into the position of simply "servicing" the loan (making the collections and dealing with short sales, etc.).  I don't think you want someone on Wall Street negotiating your loans; it simply isn't something they want to get involved in.
This is one of the reasons why some people blame "Wall Street" for the demise of the housing market.  Those investors were too willing to purchase any mortgage backed investments that the "Lenders" could come up with. So, a lot of people lost lost their homes and life savings to support those investors who were too big to fail.  Getting the picture?
The negotiator at the servicer usually receives a "bottom line number" from the investor and typically the negotiator will not approve an offer that the investor will also not approve. Especially if it is a single loan, you should be in pretty good shape, though it is up to the investor in the end.
  • May 28 2012
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Profile picture for Sharon Lewis
Ask the agent.....they are representing you and should supply you with all this information. We don't know the entire story of this transaction. 
  • May 28 2012
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