SPEEDING UP THE
SHORT SALE PROCESS MAY BE IMMINENT….
Can you believe
it? After years of extended wait times for short sales to be resolved,
the Federal Housing Finance Agency, which regulates Fannie Mae and
Freddie Mac, will require both agencies to give short-sale buyers a final
decision within 60 days. This is supposed to go into effect starting June 15th
of this year. (In a short sale, a lender agrees to accept less than the balance
on a mortgage.) But this regulation will
only affect those homes with a Fannie Mae or Freddie Mac loan.
Another key part of the regulation will be that Fannie
and Freddie must also respond to initial requests for a short sale within 30
days of receiving the buyer’s submission.
In the Chicagoland area, at one time short sales
composed over 50% of homes on the market.
The number is constantly
changing.
And many short sales sit on the market a long
time because potential buyers don’t want to wait months for a decision from the
bank and then end up not getting the home because they couldn’t come to terms
with the bank.
The number of foreclosures on the market have dropped as the number of
short sales have risen. This is because
lenders favor short sales because they are less costly and more efficient than
foreclosures. The homeowners never know how long the process will take or how
badly their credit will be hurt. Short
sales are known for being easier on credit scores than foreclosures.
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