Chase recently switched over to the Equator platform. Equator is a great system for Mortgage companies to handle their short sales and is usually an easier and quicker process. Chase however has managed to have some implementation issues. They were really good at getting the short sales done in about 45 days. When they switched over to Equator we had a ton of problems and the process took 120+ days–about as bad as US Bank! Hopefully they will get all the kinks worked out and back on track to approving short sales in 45 days.
Chase does not have their own specific forms to use for Third Party Authorization, they do however have their own Arm’s Length Transaction form which every mortgage company will have. This form basically says that the buyer and seller are not in business with each other, the seller will not be renting back the property nor buying it back from the buyer.
Chase does participate in the HAFA short sales which is the government sponsored program where the seller qualifies for moving expenses of $3000. They also have their own short sale program where the seller could potentially qualify for a larger seller incentive. The mortgage companies would rather have you short sale your home then foreclose on it so they give incentives for you to do a short sale. There are many other incentives to doing a short sale rather than a foreclosure. Credit score, future buying power and seller incentives are just a few.
When doing a Chase short sale we will initiate it on the Equator system, upload our Third Party Authorization then the rest of the paperwork which will include:
- HAFA paperwork or the 710 financial form this breaks down all your income and debt
- Hardship letter explaining why you are behind and why you can no longer afford the home
- Last 2 years of tax statements
- Last 2 months of bank statements
- Last 30 days’ worth of pay stubs
Once all the requested paperwork is received Chase will order a Broker Price Opinion or BPO for short. That request comes through a third party and usually a Real Estate Agent will be doing the BPO. The Realtor goes to the home to take notes, pictures and measurements then basically does market analysis on the home. The Realtor then sends it to the third party company outlining what they believe the house to be worth on today’s market. Then the third party sends it to Chase.
At that point the file will go from the processor to the negotiator on the Equator system. The negotiator will look over all the paperwork we provided them as well as the BPO and any internal information then issue a counter offer or an approval letter. Most of the time the mortgage company we are dealing with on Equator is only the servicer and Fannie Mae, Freddie Mac or HUD may own the loan. If so then Chase needs to follow their guidelines for counter offers and how much they will allow for closing, commissions and any past due taxes or liens on the home.
Chase will pay the seller’s closing costs and the Realtors’ commission. They will also pay a certain amount to a second mortgage if there is one. The amount given to release depends on what is owed on the 2nd mortgage and if it is in the HAFA program or not.
Once the offer is negotiated out Chase will issue an approval letter that will go over the terms of the sale. Included will be the buyer’s names, the address, the purchase price amount, the amount Chase will pay for closing costs and the amount Chase will pay the Realtos. It will also include a date the property needs to be closed by usually, 30-45 days from the date of the letter, and will say whether or not the loan is being considered “settled in full for less than owed”. 99% of the approval letters are waiving the deficiency balance but the seller needs to read over the letter to be sure that language is in there.
Do you have a mortgage with Chase and are concerned that you can’t afford your mortgage payment anymore? Please contact us today for a free, no obligation and confidential conversation about your options. We want to help educate you on all of your options so you can make an informed decision!