Homeowners underwater on their mortgage may find relief through a bill strongly supported by the National Association of REALTORS®.
The bill, if passed by Congress and signed by President Obama, would force lenders to respond to a short sale request within 45 days.
The legislation, H.R. 6133, "Prompt Decision for Qualification of Short Sale Act of 2010," was filed yesterday in Congress by U.S. Reps. Robert Andrews (D-N.J.) and Tom Rooney (R-Fla.).
"The short sale, which requires lender approval, is an important instrument for homeowners who owe more than their home is worth," says NAR President Vicki Cox Golder. "While the lending community has worked to improve the size and training of their short sales staffs, they still have a long way to go on improving response times. As the leading advocate for homeownership issues, NAR believes that quicker attention to the short sales process is vital to help homeowners ... as well as the nation's economy."
The number of potential short sale properties is rising across the country. According to NAR data, in the second quarter of 2010, four states have a significant share of properties with short-sale potential:
Florida has 27 percent, Nevada 32 percent, California 28 percent, and Arizona 24 percent.
"Unfortunately, homeowners who need to execute a short sale are severely hampered because lenders (loan servicers) are unable to decide whether to approve a short sale within a reasonable amount of time,"
Golder said. "Potential homebuyers are walking away from purchasing short sale property because the lender has taken many months and still not responded to their request for an approval of a proposed short sale price. Many consumers have mentioned that the delay in short sale price approval exceeds 90 days, and in many cases never arrives."
Golder says she commends Reps. Andrews and Rooney for their efforts on the bill and urges Congress to pass the bill quickly.
© 2010 Florida REALTORS®
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