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Short Sales Gain Steam – Finance Them Properly

May 2, 2012

Short sales have been anything but! Most take several months, but that will soon change. There have been recent proposals that this summer Fannie Mae and Freddie Mac will implement new guidelines that require servicers to respond to short sale offers in 30 days or within 60 days if multiple stakeholders, like mortgage insurers, are involved.

The new rules would streamline the short sale process, which is stressful for sellers and frustrating for potential buyers who have to endure months of waiting to find out if their offers will be accepted.

More Short Sales Than Foreclosure Sales

Short sales have overtaken foreclosure sales in recent months, according to Lender Processing Services Inc. (LPS). This is a flip-flop from a year ago. Some experts believe servicers are becoming more willing to approve short sales because the loss in that scenario is usually less than the carrying cost of a foreclosed property.

For buyers or investors, the abundance of distressed properties continues to offer opportunities. LPS notes the sales price of short sales was 23% less than similar non-distressed properties in January 2012. So, the new 30-day requirement, coupled with bargain prices and interest rates that are still at historic lows, may be the combination that finally moves short sales.

Don’t miss out – partner with a lender who is experienced in the intricacies of short sales, like us. We’ve been involved in numerous short sales transaction, and we’re committed to making the process as smooth as we can by being available, responsive, and proactive, providing regular updates to all of the parties involved.

Short sales will continue to be a strong market for housing this year, and I hope you will let me help you take advantage of it.

Source: Housing Wire, Bloomberg BusinessWeek

From Loan Officer Lou King

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