With the glut of homes lenders now own in many of the major population centers of our country the reality of Short Sales is becoming more lucrative to those Lenders. Here's the scenario;
As the second lien holders grow weary of losing 100% of their interest in a mortgage due to foreclosure taking some $$$ from the table is better than no $$$. The "Investors Will Not Allow Us To Take Less Than xx$$$" once was a very popular phrase used by Loss Mitigation Departments in the past...but not any longer. See the one thing about "Investors" is they will take something over nothing and those investors are tired of 'nothing" coming to them as these loans evaporate into foreclosure.
Remember also that almost every major second mortgage lender is also a first mortgage lien holder on other properties in and around the same market. Seeing property values continue to decline only perpetuates the cycle of loss and those losses grow and grow and grow. It is better for all Lenders to have Owners who can pay a mortgage living in houses sold "short" than to have vacant homes not performing and losing more $$$ after foreclosure. This mind set or business philosophy has taken a while for the Big Boys to learn but as with all things that succeed it must be 'Market Driven" to effect a change in philosophy.
As Short Sales become 'National News Headlines" on all the major news outlets it is apparent that this part of the mortgage business will continue to grow and lenders will be forced to streamline their processes as the industry has now become Market Driven by Short Sales.
Foreclosure is your final option....
Paul Moye, Broker
Your Middle Tennessee Short Sale Professional