Recently the US Government has outlined some new programs that may change the way Banks and other lenders handle their Short Sales.

On December 1st the Treasury Department outlined a program to attempt to streamline the Short Sale process which has varied considerably from lender to lender.  The program attempts to set nationally uniform document, timelines and financial incentives.

Buyers are often frustrated by the length of time it takes to get a short sale decision.  Sometimes after waiting for months the seller and lender can't come to an agreement on the terms and conditions of approving the Short Sale.  This leaves the buyer out of a house.

Not all banks and lenders are happy about this program.  First the bank has to be convinced that a Short Sale will net (amount of money they get at the end of the day) more money than foreclosing on it and selling it themselves.  In Tucson, many buyers will look at a foreclosure first before a short sale because of the semi-quick (as compared to a short sale) decision.  Thus some foreclosures may command a higher price.  Next,  many of the banks have investor guidelines that may conflict with the new program making it difficult to participate.

However, the Obama Administration has some financial incentives for participation:

•·         Homeowners who successfully complete a short sale under the program may receive up to $1,500 to defray relocation costs.

•·         Mortgage servicers can receive $1000 per case

•·         Investors can get $1000

•·         Second Lien Holders receive up to $3,000 from the sales proceeds.

Managing short sales efficiently is a key component to the housing market recovery.  Having a streamlined process with set timelines will go a long way to make short sales more attractive, command higher prices and help with the housing market recovery.

If you are considering a short sale in Tucson, Marana, Oro Valley, Vail, or Sahuarita Arizona, it is important to use a Real Estate Professional who is experienced in Short Sales.  Please contact us to schedule an appointment to discuss your situation.