As an agent who has been working with shorts sales since before they were the fad I am seeing a few interesting things happening that many people are mistaking for the end of the short sale era.
First HUGE bank delays. This may seem like an ironic starting point (as short sales have always taken what seem like forever), but many buyers, sellers, and agents would agree that over the last six months in utah, short sales have become even more "trouble." Why is this? What has changed?
The answer is that nothing has changed, and THAT is why you may have a longer wait to buy, or sell a short sale these days.
Banks are, and always have been, concerned with one thing. The bottom line. That has not changed, nor should it. There are other issues at hand, but remember banks are "for profit" organizations, with shareholders that are hoping for profit. If that has alwasy been the case, why are they now taking even longer to get anything done?
Values are rising...
Think of this in a more personal setting... If you had loaned someone money to buy a home, and in turn, they gave you the deed to their home, and they had quit paying you, you would want your money back. But, if you take the home from them that is all you get, and the home is not worth the money that you gave them... Enter rising home prices into the equation. What if values were going up? Would it not make sense to wait a bit for this home to be worth more? If it was you personally it might not be, because you could put that money to better use. But what if the government had given you billions???
Short Sales in Utah are taking longer now because values are rising, and the economy is getting better. The banks know this and realize that it means their property is becoming a better asset, AND the owners are getting back on their feet... possibly. So they wait.
The key to getting short sales to work in our current Utah market is to have a strong hardship explaination, and an team that understands how to short sell a home.
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