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I’ve had limited interaction with Bank of America. And what I have had has never been favorable.

I am aware of how Fannie handles posting of the KYO form and cash for keys documents.

I have a friend renting a local home, a letter came in the mail today stating that foreclosure proceedings have begun and will expect occupant to vacant the home prior to HUD taking the house over. (60 to 90 days)

Then the letter states that if HUD does not take it over there will be other options.

My question is will this tenant experience a knock on the door by an agent requesting cash for keys agreement?

Or if HUD does take the house over, will HUD offer a cash for keys?

Or will there be a cash for keys of any kind offered?

I thank you in advance.

Its been about 5 years since I started in this REO indurstry.  Progressively, the game has changed and things have become harder and harder to deal with on a small level.  I have 18 employees and 20 sales agents, so we get it all done here.  But now, during the same time every year, we have these 2-3 weeks of nothingness.  What I don't understand is why there is a moratorium?  Listen, I have a heart, and I understand people do fall onto bad times, but c'mon.  You took out a mortgage a few years ago, that you, your wife, your children, you parents, friends, etc all knew you couldn't afford.  But, it was the "american Dream" so you did it and never looked back, until you couldn't make a payment anymore!  IF you are a tenant of a foreclosed property, I truly feel for you, and I will do anything I can to help you out during these times.  I have tenants all the time who tell me they have been making their payments for 2 years and they cant understand how this happened.  You DESERVE CASH FOR KEYS.  

So now what, the banks out the 300k they gave you, your living in a house that you don't pay for, the bank is paying your taxes and utilities, and you cant even leave the house in good shape when you leave!  Show some pride and be amicable and get out when you stop paying!  There is no reason a bank should have to pay you a Cash for Keys of even a dollar!  You should just leave!  Lets think about this logically, I buy a car for 50,000.  I pay 5,000 up front and i'm left with a payment of about 1,000 a month.  If I stop paying for the car, does the car company come to my house and offer to give me THOUSANDS of dollars to give them the car back?  No, they hire a tow truck company, and come take the thing off my driveway!!

On top of all the ridiculousness of people living in houses that they cant afford, I am a born and bred New Yorker.  In this lovely state, we are referred to as an "Attorney State" and a "Landlord State".  So, on average, it takes about TWO YEARS, yes TWO YEARS, to get a foreclosure completed here.  So thats TWO YEARS of not making a payment to the bank, before they can even have the DEED for the property!!!  Then if I still don't want to leave, guess what?  I can usually stay another 1-3 years while the LANDLORD (The foreclosing bank) tried to EVICT me!!!  So in essence, I can live in a house, with NO EXPENSE, for 3-5 years!  Why on EARTH does it take this long?  And then, to top it all off, the banks are nice enough to stop "evicting" people during Thanksgiving, and this year between December 20th-January 3rd.  Now, although it seems like the "right thing to do", if the eviction of a homeowner happens to fall during that time, let them go live back home with their parents until they can afford to move out, OR use the past 3-5 years of mortgage, tax, utility payments that you have NOT made, and go rent a place you can ACTUALLY AFFORD!!!

I guess I would really just like to see the 7.5 million houses that are in the backlog (The gloomy shadow inventory) come to market.  Maybe we can actually stabalize the housing prices if we sell off the homes we need to in order for the market to correct itself.  :)

Well it seems that now some of the big banks are freezing foreclosure procedures due to their inavility to comply with local laws and regulations that protect the home owners or delay the foreclosure procedures, it seems that some lenders have rush the foreclosure procedures and broke the laws. First started wtih GMAC, then Chase, now Bank of America.

There are several issues with this new moratorium, first there will be more banks adding to this list, and this mess might not be sorted out until March or May of next year, that might be done on purpose because the GSE are pushing for the lender to take action on the late loans, see the news on Wells Fargo last week. http://www.dsnews.com/articles/wells-fargo-puts-stop-to-short-sale-extensions-2010-10-01. Also the OCC ordered the Largest Servicers to review their foreclosure process. This might not affect us because they are liquidating their inventory little by little to avoid a really hard crash and decline of propery values, lets face it, with low prices, low interest and no one is buying, it is hard to say if it is because they are not lending or because there is very little confidence from buyers, but also at the end of the day we all need shelter, so it makes sense to purchase now, and I have seen several potential buyer not been able to qualify for a home mortgage loan.

The other problem I see is the rumble from lawyers and previouse owners, who will try to sue the lenders for not been in compliance with the federal and local laws and regulations of the foreclosure procedures, etc. I did a cash for key on Saturday, and the borrower just kept asking me if my client was following the right procedures, if they were going to join Bank of America and Chase with this issue, etc.

It is going to be interesting to follow this new moratorium, because of the political impact and the possible impact it might have in the business. I think if the foreclosure process was not done correctly, then what would they do, if the house is already sold, can the courts reverse the sales, etc, then we will have the issue of the current owner. Most likely this would be ratified with money, how much? morally the prevoius borrower was in default, but I am sure there could be damages, etc. Would the courts and the credit bureus wipe out the "Foreclosure" from their records so maybe if their finances have change they can get a loan, would the lender try to work something where they can put the previous owner with a new loan or similar loan to the previuos one in one of their houses.

As REO agents I think is important for us to do as many Cash for Keys as possible, this way the previous owner has agreed to relinquish his/her home to the bank, but I am sure there are some loopholes there too. Well maybe the new assignments from the bank would be more like deed in lieu with a lot of legal terms to protect the bank, and I hope we can have the right documents to protect ourselves just in case,