Thursday, September 10, 2009

Short Sale Incentives

It sounds like the Treasury is going to add short-sale incentives to the current program of loan modification incentives. This could have a large impact on the Valley, where so many people are underwater in their mortgages and either can not qualify or don't have a good incentive to participate in the current loan modification programs.

I won't comment on whether this is a good or bad idea until the details are released next month. Having unsuccessfully made offers on 2 or 3 short sales last year, I feel confident that Realtors will benefit from this. Will homeowners, lenders, and the economy in general benefit? It's too early to say.

From Housing Wire:
He (FHA commissioner David Stevens) said the program will simplify the process of pursuing short sales and deeds-in-lieu, which will encourage more servicers and borrowers to participate in the program. The program will standardize the process, documentation and short performance timeframes.
“These options eliminate the need for potentially lengthy and expensive foreclosure proceedings, preserve the physical condition and value of the property by reducing the time a property is vacant, and allows the homeowners to transition with dignity to more affordable housing,” Stevens added.

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