It is a fact the foreclosure mess was the result of unscrupulous lending practices. Unfortunately, it did not stop there as federal regulators continue to investigate allegations of illegal foreclosures and penalize lenders who are found guilty.
With such heat experienced by the banks to make sure they are following proper and legal foreclosure process, it is not surprising why many have become more accepting of short sale proposals.
Short sale transactions used to be looked at by some banks with skepticism, thinking the homeowners are only trying to get out of their mortgage obligations by selling their homes at an amount less than what they owe in mortgage.
But banks are realizing, albeit slowly, the situation has actually changed with the mortgage collapse. It is actually no longer surprising for a homeowner to apply for a short sale or loan modification considering home values declined considerably and the national economy is in recession.
With a short sale, it is actually a win-win situation for everyone. The homeowner gets to pay off their mortgage debt while the banks save money on foreclosure costs and recover some of their losses. Even buyers of short sales benefit since the properties come with almost a guarantee of instant equity as soon as home values climb once again.
Even the federal government sees short sale as a valid foreclosure alternative and offered incentives to banks and mortgage lenders if they successfully completed such transactions.
Of course, although short sales are gaining popularity, the process involved is quite complicated. Distressed homeowners and short sale Realtors should work hand in hand to prepare the necessary documents and find a buyer who can stick around and wait for the lender to approve the sale or make a counter offer.
It takes some time but the benefits will certainly motivate you.