With Bank of America halting foreclosures, what should I expect?

User question: What does this news mean? BOA has stopped foreclosures in AZ too. My condo was due for public auction in December. Is that changed? Will BOA send me a notice about this? What should I expect in the next weeks, months?

Answer from blueroof.com: While yes BofA has put a hold on many foreclosure proceedings, as of right now it only applies to properties being foreclosed through the judicial foreclosure process which is not the process we use here in Arizona. The judicial foreclosure process is typically used back East.

So the short answer is that as of right now your foreclosure is still proceeding. That could change as there is talk of them putting a hold on most or maybe even all but it is only talk right now. So you likely will not be receiving anything about this since it does not apply to your property at this time.

Since you have about two months before the foreclosure sale, you still have some options. You can attempt to short sale the property which can be better in the long run than a foreclosure and, if you qualify for the government's short sale program, may be able to receive $3,000 at closing to use for moving expenses and so forth.

It is an option that you have but you will need to start that process right away in order to get something done. You would need to start the process about 30 days before the sale date in order for the bank to work with you.

Update from blueroof.com: After responding to you I did some more research and did find that BofA did suspend all foreclosure proceedings in all 50 states. I wanted to get back with you on this as it is likely that your sale date has been postponed.

You may get something from BofA stating this in the near future but it may take some time as they need to inform tens of thousands, if not hundreds of thousands, of people throughout the nation. The reality of this is that it is a logistics error and the likelihood that anything major will happen is slim. They will review the situation, make a small change (if necessary) and then will begin the process again in the near future.

The good news is that BofA and other banks going through this right now are likely going to press for short sales to go through to avoid the foreclosure issues they will have because once they resume the foreclosure process on homes, they will be sending out hundreds of thousands of notices in a short period of time. If you are interested in pursuing alternatives to foreclosure, the time to start is now.

*Nothing here is considered to be legal or tax advice. Any and all questions regarding tax or legal issues need to be directed to an appropriate and licensed professional.

Joe Duffin
Managing Broker for Blue Roof Realty

Please note that ABC15.com, and its paying advertiser blueroof.com which answered this question, are not qualified to offer tax advice and the best path to take in any situation regarding income taxes is to speak with a professional tax preparer or CPA.