Streamlined Short Sale Processes on the Way
Posted by Terry Burger on Wednesday, December 2nd, 2009 at 5:35am.Treasury Outlines New Guidelines to Streamline Short Sales
Short sales have long been problematic for buyers and sellers alike due to the lack of urgency by banks to work out contracts in a timely manner. We've all heard the horror stories about buyers waiting three to six months or more before hearing from the bank on whether their offer was accepted or not.
According to the National Mortgage Bankers
Association, more than 9.1% of Georgia mortgage borrowers are 60 or more days
late on their mortgage payment.
In 2010, short sales are predicted to be a larger portion of the marketplace in the Metro Atlanta region. Some experts estimate that 40% of home sales in 2010 will be "shorts."
Short sales are seen as beneficial for 3 primary reasons.
1) Short sales are easier on the seller's credit report. In most cases, the seller can clean up their credit, get their life in order, and buy a new home in 3 years. Foreclosure can impact home ownership up to 7 years.
2) On a short sale, the properties tend to be in much better condition than a foreclosed home, therefore keeping the home values higher and neighborhoods less blighted by abandoned houses.
3) In most cases, short sales are much less expensive to complete than a foreclosure, and with the new guidelines outlined in the Home Affordable Foreclosure Alternatives Program, the banks can actually receive money from the government for following the streamlined procedures.
The new guidelines outline several significant improvements for buyers:
- Mortgage servicers will have 10 days to approve or disapprove a short sale. As of today, each bank has its own policies making the short sale landscape that much more vague. Short sales currently can take up to six months or more to close with few exceptions.
- Guidelines will be in place to handle the subordinate loan (2nd mortgage) so that arguments between the first and second mortgage holder will be greatly diminished.
As always, you need a well educated real estate professional to guide you through the process. I write these blogs to help educate our website members. As you can tell, I am serious about real estate and am qualified to help any client go through the short sale process. If you or someone you know could use the expert advice of a seasoned real estate professional to help you buy, sell, or invest in North Atlanta; then please call me at 678-388-1020.
Have a great day,
Terry Burger, RE/MAX REALTOR and Creator of CallAtlantaHome.com
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