A pilot program launched by Bank of America in Florida has drawn minimal interest from homeowners seeking short sales. The program pays up to $20,000 to homeowners who sell distressed properties in a short sale. However, as of late January, only 60 people have taken advantage of the program. Bank of America had targeted 20,000 of the 1.1 million mortgages it services in Florida.
In the program, qualified homeowners would get 5 percent of the unpaid mortgage balance as of August 2011, with a minimum payout of $5,000. And so on up to a maximum of $20,000. The sales price does not impact the payout.
By offering the incentive, Bank of America saves attorney fees, court costs and property taxes by avoiding foreclosure. It also speeds the process of getting bad loans off its books and gets the properties back on the market faster.
The bank tested the program only in Florida because of the higher foreclosure rates.