You may already know but just in case you were wondering it appears that there will be another flood of foreclosures coming on the market this year (2010). Currently according to a recent webinar I was on, 50% of current mortgagors are upside down in their homes meaning they owe more than the property is worth. What does this mean...well I am open for discussion, but I would surmise that it means there is going to be another flood of foreclosures on the market unless we as agents start pushing the short sale option or other options like loan modification. And we all know what another flood of foreclosures is going to do...home values plummeting even more. That may be okay if you're not currently a homeowner, but if you are, you may end up in that category of upside down home owners.
We need to get it out there to people that there are other options to foreclosure and that taking advantage of HAFA opportunities will definitely be more beneficial to the upside down home owner than " strategic default". In some cases after going through the right steps, a short sale can result in no deficiency judgment and much quicker recovery from bad credit. What people don't realize is that the banks/mortgage companies look harder on "strategic default" than they do someone who is trying to do as much as they can to avoid foreclosure. It could mean the difference of 2 years until they can get another mortgage and 7-10 years as a result of "strategic default". In some cases, a person may be able to recover almost immediately.
This all creates more uncertainty with buyers also. In many cases buyers are hesitant to do anything because they feel that home ownership is to risky anymore. There are more people opting to rent now than has been for many years. The dream of home ownership become a nighas now become a nightmare to avoid.
So if "short sales" are bad words to some of us we better change our thinking and get with the program and start promoting other options to people!
P.S. I was reminded that this does not apply in all markets. This is a general statement that applies to most of the country but not all!