02-07-2012 08:35 AM
No bottom is sight...
Banks, accelerating efforts to move troubled mortgages off their books, are offering as much as $35,000 or more in cash to delinquent homeowners to sell their properties for less than they owe.
Lenders have routinely delayed or blocked such transactions, known as short sales, in which they accept less from a buyer than the seller’s outstanding loan. Now banks have decided the deals are faster and less costly than foreclosures, which have slowed in response to regulatory probes of abusive practices. Banks are nudging potential sellers by pre-approving deals, streamlining the closing process, forgoing their right to pursue unpaid debt and in some cases providing large cash incentives, said Bill Fricke, senior credit officer for Moody’s Investors Service in New York.
Losses for lenders are about 15 percent lower on the sales than on foreclosures, which can take years to complete while taxes and legal, maintenance and other costs accumulate, according to Moody’s. The deals accounted for 33 percent of financially distressed transactions in November, up from 24 percent a year earlier, said CoreLogic Inc., a Santa Ana, California-based real estate information company.
Karen Farley hadn’t made a mortgage payment in a year when she got what looked like a form letter from her lender.
02-09-2012 02:45 PM
You need to stop reading the DOOM & GLOOM TIMES. Are you a salesman in the real-estate business ? Sure sounds like it..
Just trying to enlighten people to stop inhaling the fairy dust.
02-15-2012 08:06 AM
02-16-2012 11:13 AM
I agree with joe creole.
That news is not gloom and doom. If short sales close at closer to fair market than foreclosures, having more of them in situations that would have been foreclosure may have some real benefits to market stabilization. While I think the free market should be allowed to bottom out the housing market, I'm not sure that pushing more foreclosures through than necessary won't cause an overcorrection and do more harm than good.
To the original poster: while I agree there are some major problems out there in the market that could take years, even a decade to resolve, it seems like you just post negative all the time for the sake of doing so. That's fine, but I wonder where your motive, interest, and reasons lie.
Are you a prospective purchaser? A renter? Someone who likes schadenfreude? It's all good, I suppose. Just wonder why always with the gloomy news posts.