To Shortsale or Not to!!!

The following article was in REO Insider and written by Jon Prior, it sounds great but not sure that it is completly accurate!!  As a active Real Estate Agent currently working short sales, in the past month I have banks give us riduclous counter offers to our short sale offers.  When I say riduclous they really were I am talking from $50,000 to $75,000 over the listed price and there is no way these homes would ever appraise at the value the banks are asking for.  We will keep submitting short sale requests but our overall feeling is that maybe 50% will be approved.

It seems that an increasing number of foreclosures in California are being cancelled, and the reasons for this spate of cancellations can be attributed largely to programs such as HAFA, which is intended to encourage lenders to allow short sales as opposed to foreclosures.

HAFA encourages short sales by providing cash incentives to lenders who allow short sales, especially those who hold subordinate mortgages, which can effectively cause the short sale process to grind to a halt.


According to the article, 22,000 foreclosures sales were cancelled in June in California alone. Many of these cancellations can be attributed to a rise in short sales. In southern California alone short sales are up nearly 75 percent in 2010. It appears that many lenders would prefer a short sale to a foreclosure, especially once the HAFA incentives are taken into consideration.



It remains to be seen whether this trend will continue, or if this is some sort of temporary aberration, but this could be evidence that the HAFA program is having a net positive effect in some places, which is more than we can say for other foreclosure prevention initiatives