Bank of America is selling off many of its mortgages. In an effort to streamline the company and become more profitable, Bank of America CEO Bryan Moynihan launched his Project New BAC initiative which includes laying off more than 16,000 jobs by the end of the year, 3,200 of which will be in its mortgage origination unit. With this major cut in its workforce we estimate Bank of America is selling off a tremendous amount of its mortgages to new mortgage servicers.
Bank of America has sent letters out to many of their current mortgage customers informing them of the change, but they haven’t been given a lot of notice of the transfer, in some cases just a couple of weeks.
See an example of this Bank of America mortgage transfer letter here.
Many customers are wondering why their loan is getting transferred, or if the terms of the loans will be different from their original loan terms. According to the letters, the terms and conditions of the loans are not being changed. But customers will no longer have access to their loans through the Bank of America website and won’t be able to make payments at any of the Bank of America banking centers.
This is bound to cause confusion as many customers unaware of the change may still send payments to Bank of America rather than their new named servicer. Keep in mind that according to the Real Estate Settlement Procedures Act outlined in the letter, during the 60 day period following the effective date of the transfer, a loan payment received by Bank of America before its due date may not be treated by the new loan servicer as late.
How Does This Affect Short Sales
For Bank of America customers who are in the process of a short sale, the letter states that any documentation they’ve submitted will be transferred to the new servicer named in the letter. However, this is not happening. We are already realizing that the paperwork is not getting transferred. For those borrowers who were waiting for a decision regarding this process, the decision will now be made by the new servicer, but if they don’t have the documentation, there will be serious delays. So it’s imperative that when you receive this letter you contact the new servicer immediately.
Do You Qualify?
If you’re in the process of negotiating the short sale with Bank of America, but it’s not approved yet, you will most likely be forced to redo the whole process with the new servicer. This means you will have to resubmit all the paperwork all over again. We’ve already seen cases where someone was approved for a short sale, and then it got transferred, but it would only be honored for up to two weeks.
Another concern is with Bank of America customers who have optional insurance products such as mortgage insurance, life, or disability insurance through Bank of America. According to the letter, coverage will be canceled so customers will have to contact the new servicer for information about those options.
Be on the Lookout for This Letter
If your mortgage loan is with Bank of America you may receive a letter from them concerning a transfer of your mortgage loan. We’ve heard from some of our clients who’ve received this letter, and know that a couple of the new mortgage servicers named are Seterus and Homeward, who we’ve worked with and are both very responsive and professional. We’ve heard that Select Portfolio Servicing (SPS) is one of the new servicers as well, but they have been very difficult to work with. Regardless of the servicer that now has your mortgage contact them immediately with any questions. They will also reach out to you in a separate letter.
This is all the more reason to hire the right Realtor when doing a short sale since not every Realtor can do a short sale.
I wish I knew this on Monday It would have saved me a lot of anxiety. I closed on a short sale last week only to find out the wire was returned from BOA. A day after receiving written approval on the short sale he loan was sold to SPS. When I called SPS they told me they would honor the approval letter. The day of the closing I called SPS at the closing table to double check where the wire should be sent. We were told to follow the instructions on the letter and send to BOA. Turns out the loan was sold on August 15th without the knowledge of the asset manager working the file and issued me an approval letter on August 30th! When I called SPS I was told we had to start the file over again . I went back and tracked the whole file with BOA on the phone for 3 hours and that is when I found out that the letter was issued 15 days after the file was sold. I called SPS asked for the collateral dept and spoke to a supervisor. The wore was sent to SPS and EVERY document that was sent to BOA was emailed to SPS so they would have a file. Hopefully that will be it. I will keep you updated if there are any other updates. A word to the wise make sure your files are in order and well documented. That is why you don’t use any agent to handle a short sale
Hi Joanne,
This is why we have notified all of our clients and told them to send us any letters they receive.
So far this has not happened to us and we hope it does not. Good luck cleaning up this mess.
I just received a letter informing me of the ‘transfer’ of my loan. Funny thing is…since B of A refused to modify my mortgage, and never closed on 4 short sale agreements that I signed since moving out of home due to ‘missing documents’…my HOA foreclosed to recoup late fees in March of 2012. Original date of default was May 2008..Original Bank of New York Foreclosure suit dismissed according to county clerk records in June of 2011…
So I haven’t had the title to the house in 8 months, and B of A is oblivious and continues to send me mortgage statements, HAFA program information (I applied and was accepted into the program 3 times and finally washed my hands of the whole thing last year when it was ‘declined’ and the last short sale agreement went null and void)…and now I’m informed that I can send my payments to select portfolio who is my ‘new lender’….LOL! Seven more months of no default judgement and I can file a motion to vacate judgement if they ever figure out that they are supposed to be suing me. What a ridiculous organization.
I am so worried. I am closing on a chapter 13, never been late on a payment and BOA sent me notice they are transferring my HERLOC loan to Specialized Loan Servicing LLC. A debt collector???? I’ve been reading online horror stories about this company. What should I do, because I don’t want to transfer in fear of the worse.
I went into BOA today to ask about refinancing only to find that my mortgage had been sold to Greentree. I never received any notification.
I called to refinance as well and found that my mortgage has been sold. Several phone calls later, I talked to Fannie Mae my “investor” and was told that it was a decision by B of A. The B of A customer service rep told me it was Fannie Mae who made the decision. I did a search online of the company they sold my mortgage to and it looks like it is some rinky dink outfit in Texas. I’m sure my nightmare is just beginning.
Our second was sent to Greentree as well. We had very little notice from this service and we get almost nothing fromthem in the mail, mostly by phone. mi contacted them to get everything on track. I was told by Greentree that bofa still owns the loan but the are collecting the debt.
I also read on bankrate.com that 2nds were being entirely forgiven and reported as paid and closed on your credit. Is that true?
It’s very confusing.
Nearly completed short sale and then we get notification that BofA sold both mortgages to different companies. This is in complete bad faith at the least. This essentially started the whole process all over again! Their co-op short sale which is pre-approved should take approx 5 weeks. Well, we are on 5 months now! I believe this is criminal when they agreed to a short sale, but then left us high and dry just days from completing the process by then selling our loans to another servicer. Does anybody else feel the same way?
B of A sold our home loan to Green Tree , we had making homes affordable reduced our loan from some $1900 a month to 1295.00 per month..Now Green Tree sent the first payment due on 05/01/13 and it was $1416.16 and June’s payment has escaluted to $2755.24 what the hell are they doing. They are forcing us out of our home! Someone please help. We have to children and this is there home since 05/2004!
I was served with papers from Bank of America on May 16 2013 to sale my house on June 4. I called B of A and they said they sold my loan to Select Portfolio Servicing. So I called SPS and they said they just got my file on May 1 and would not get my info into their system at the earliest the last week of May. They are sorry but they have no info on me. After calling many agencies I found an agency to file a complaint. The agency is the Consumer Financial Protection Bureau. I urge all people dealing with B of A’s newest way to take your house to file a complaint. The # is toll free 855-411-2372. This agency is support to track you’re complaint. It can also be filed online. Maybe we can get some justice if we all file a complaint with this agency.
I just got my transfer letter last night. Mine was sold to Green Tree Servicing, LLC as of June 1, 2013. That’s a whopping 11 days notice.
As soon as I get done with a remodel project, I’m refinancing locally.
I received a letter TODAY that my mortgage was sold to Green Tree EFFECTIVE NEXT WEEK! I have 8 years left on my mortgage. WTF?
Not a lot of notice, B of A – And I heard Green Tree is “ruthless” and impossible to reach…..
We just got a notice that our loan is being bought out by Green Tree. We have never missed a payment in over 10 years. We are more than upset. We have no idea of what we are looking at now. Our mortgage is very small at this point but we are truly worried that these changes will manage to make our lives more than miserable. What are our options? Their paper work certainly wasn’t helpful. We don’t want to refinance but it may be our only option depending on how Green Tree treats our loan. I’ve been a B. of A. customer for over 20 years so I’m furious at their blasé treatment. Sick of big banks, we bail them out, they treat us like dirt.
I just got my transfer notice in an email tonight. Says I should have been sent a letter, but that didn’t happen. Transfer is effective June 4th to a company called Nationstar Mortgage.
Calling the realtor in the morning to see what my options are because almost all of the reviews are negative. I refuse to have my money played with by an untrusted company.