Government Announces Short Sales Guidelines

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Real Estate Broker/Owner with Buyers' Choice Realty

 

Government Announces Short Sales Guidelines

The U.S. Treasury Department announced new guidelines this week designed to make short sales go more smoothly.

To qualify under these new guidelines:

  • The property must be the home owner’s principal residence.
  • The home owner must be delinquent on the mortgage or close to defaulting.
  • The loan must have been made before Jan. 1, 2009, and be for less than $729,750.
  • The borrowers’ total monthly mortgage payment must exceed 31 percent of their before-tax income.


Under the plan, borrowers will receive $1,500 from the government for selling homes for less than the amount of their mortgages. Mortgage-servicing companies will get $1,000 for each completed short sale. Second-mortgage holders can receive up to $3,000 of the sales proceeds in exchange for releasing their liens. Investors who hold the first mortgage can collect up to $1,000 from the government for allowing the payments.

Borrowers who complete a short sale under the program must be "fully released" from future liability for the debt, according to the guidelines.

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Mirela Monte
Buyers' Choice Realty - North Myrtle Beach, SC
Myrtle Beach Real Estate

Interesting news.  What do you think about it?

Dec 02, 2009 08:15 AM #1
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Leslie Helm
Tennessee Recreational Properties - Jamestown, TN
Real Estate For Trail Riders

A carrot is always better than a stick and some is always better then none. "Guidelines" should help to add structure to what is now an amorphous mess! I'm not sure this is enough of an incentive but it might be for some giant lenders where there's enough volume.

Dec 02, 2009 08:46 AM #2
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Mirela,

We have read the  intentions. Maybe good intentions (not sure even about it), but how far they are from reality? Is this a road to hell or to paradise, or just simply to nowhere?

Jan 02, 2010 05:55 PM #3
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Mirela Monte

Myrtle Beach Real Estate
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