In an effort to avoid properties going into foreclosure, Bank of America launched a program that gives up to $30,000 to homeowners who sell their homes through short sale. With the short sale rules changing in June, this could be a nice incentive to current underwater homeowners who are thinking about abandoning the property.
These payments are called “relocation” payments and will vary from $2,500 to $30,000. The formula is calculated based on the home’s value, amount left on the mortgage and other factors. The amount of each payment is determined on a case by case basis.
Why Avoid Foreclosure?
For underwater homeowners, avoiding the stigma of foreclosure is preferable to being kicked out of the home in front of neighbors. However, with short sales traditionally taking up to 1 year to close, many people simply abandoned their homes.
The new short sale rules due to take effect in June state that short sales need to close within 90 days. Under these new rules, homeowners who are eligible for the Bank of America relocation payments can make a more planned transition out of the home.
For the banks, avoiding the foreclosure process means getting the distressed properties back more quickly, which can save them money on property taxes and other fees. Abandoned properties also attract vandals, which increases the repair costs once the bank reclaims ownership.
This plan is available for current Bank of America mortgage holders but contact them directly to see if you qualify.
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