In the past few weeks it has become quite clear that Lenders are playing under a different set of rules, at least the Junior Liens (2nd Lien Holder). In the past they would take $3,000 from the first lien and hop away happily that they got something.
The short answer is that they are not negatively affecting their bottom lines, rather it is being enhanced. It is quite a simple process. We, as agents, are working for our clients. The Lenders are working in large numbers.
Follow me: In the past the Junior Lien could approve 20 Short Sales receiving $3,000 on each for a total of $60,000...today they will demand $30,000 from each in cash or $75,000 in a Promissory Note. Well, if 3 out of 20 agree to the cash, the Junior Lien just took in $90,000. They will have a higher percentage agree to the Note which they can then sell to a Collection Co. and net even more.
to the Lender it is an entry in an Excel spreadsheet.