We welcome input from all, be it opinion, fact, or a combination thereof. The bailout we are "experiencing" is still very much up in the air. We have heard many variations of this plan and are convinced it will be quite a while before any US consumers have anything to gain. The plan will eventually be subject to severe regulation much as the underwriting procedure we go through to get a standard mortgage or short sale approved. The burden will ultimately fall on the consumer to show hardship and the inability, not unwillingness, to pay.
We have been in the mortgage business for years and recently began working on the short sale industry here in Central Florida. Our take on the business is that there are many consumers who need our help as professional Realtors, mortgage professionals and short sale specialists. For example, a consumer who cannot pay their mortgage has several options...
1. Negotiate a loan modification with their current lender--this may take months as lenders are inundated with requests and it is more difficult than qualifying for a mortgage.
2. Foreclosure--this is seemingly an easy out for many consumers. Think again, this will result in their falling into a new category as far as Fannie Mae and Freddie Mac are concerned. These consumers will be banned from a conventional new home purchase for 5-7 years, have severe credit ramifications and be subject to a deficiency judgment filed against them. The judgment will allow the creditor to garnish future earnings to collect the debt.
3. Short Sale/Pre Foreclosure Sale--this is the better choice for the consumer than foreclosure. Consumers who choose to negotiate a short sale will be able to purchase a home within 2 years, mitigate damage to their credit by reducing the number of late mortgage payments and may not be subject to a deficiency judgment on their credit.
This is only a summary of what we can do to help consumer. I would like this to be an informative blog where we can all post the latest information on the "bailout" plan and any other pertinent information on short sales, avoiding foreclosure and loan modification options for consumers. We need to help our nation and the real estate industry out of this predicament and I believe we can do it if we all join.
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