Short Sale Tidal Wave...is it coming???
I have been doing Short Sales for over 4 years, am SFR certified, read about the Short Sale process daily, try to keep as updated as I can, but still have a nagging thought in my head..
"Am I ready, (not if, but when), that Short Sale deluge hits?" Because I truly do think it's coming. Here in the Coachella Valley, we are seeing Short Sale numbers increase on a monthly basis. Our distressed inventory numbers have dropped, and the Short Sales always appear to be the "best deals" around. Well, they should be because we all know they are long and torturous to complete.
I suspect even more are coming end of 2010 and 2011, 2012 will be inundated. Why? The Shadow Inventory of Homeowners 30 days or more behind on their mortgages, job losses and educated homeowners seeing the equity in their property drop to 50 to 60 cents/dollar. The hitch is getting the Lenders to acknowledge that Short Sales are preferrable to Foreclosure.
Short Sales are averaging about 13-15% less costly/home than for a Lender to Foreclose..still the Servicers make more money the longer they hang onto those Short Sale properties and gather fees from the Investors on a monthly basis. We all know the Banks are running the show right now, so they will drag it out as long as there is money to be made and Shareholders to be fooled as to portfolio values.
But...I suspect there will be more pushing from the Feds to HELP homeowners BEFORE they vacate. Vacant homes are the absolute worst thing for neighborhoods and if you keep owners in their homes during the Short Sale process, or at least paying for utilities/maintenance/HOa's, vacancies are not as horrendous for neighborhoods.
Getting the Lenders to acknowledge "non-pursuit for deficiencies" in the future will enable more completion of Short Sales because Sellers will opt to NOT forclose, but rather to negotiate the notes due..at least the Lenders get something! We shall see.....
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