Banks recognize the benefits of short sales
As an agent, you know that a short sale can save your client from a devastating foreclosure. It’s simply a better solution for a homeowner in distress than a bank repossessing the home.
But now, banks have also realized that short sales are a better option for their own bottom line.
They are shifting away from sales of bank-owned homes, often preferring pre-foreclosure short sales. Lenders are even starting to approve more aggressively priced short sales and provide substantial homeowner relocation incentives up to $35,000; it still makes the lender more money than an REO sale.
A push for more Efficiency:
Not only do lenders prefer a short sale, major banks like Bank of America and Wells Fargo have been working on improving their short sale processes, adding human resources and drastically cutting approval times. Efforts to streamline the often-lengthy short sale approval process appear to be paying off. Bank of America’s stated goal is to increase the number of short sales closed in 2012 by as much as 60-70%. The Federal Housing Finance Agency (FHFA), which oversees mortgage companies Fannie Mae and Freddie Mac, just introduced specific response time frames. It has ordered mortgage servicers to respond to offers within 30 days, and approve or reject these offers within 60 days. Communication and decision time lines are critical elements of the short sale process, and these time frames should allow more efficient processing of short sales.