I heard from a RE friend that the gov’t is lookign to stop short sales and put the pressure back on the bank. basically, they would allow homeowners to sell thateir house at FMV in order to get out of the loan.
Anyone heard of this.
I have not heard anything about this but we all know how the government like to “talk” about these wild bailouts. We specialize in short sales.
I think what I heard on the news was that Goverment was going to make easy for people to sell their homes in Short Sale. They were giving guidelines to banks on how to make that happen to save people’s credit so they can buy home in hear future. This is good because if we have increased number of people living in apartments or rentals with bad credit there will be less buyers of home in near futre and that is not good for economy or any of these banks who deal with bad morgages.
DFW
The government is not stopping short sales. What happened is that there used to be a penalty for having REO’s (real estate owned by the bank) on their books, but with the economic collapse, the penalties have been removed/unenforced, and bailout money was handed out. This had the effect of rewarding the secondary market investors for foreclosing. So, these SMI’s have altered their methods of evaluating short sales and most are now using the minimum threshold analysis, which is a percentage of the current fair market value of the property they must net receive.
Recently, the government observed the increase in foreclosures and realized their screw-up. They are now ordering the now-government-owned institutions to loosen up the strangle-hold on short sales.