St Louis Mortgage and Lending Experts Agree Short Sales May Be the Answer
Author: Floyd J. Tapia // Category: loansThe national real estate and housing scene has been horribly plagued with home values sharply dropping, unemployment rates skyrocketing and foreclosures being somewhat of the norm.
The bitter truths have shown that a meager 4 percent of homeowners on a national basis that faced foreclosure within the last year did receive mortgage assistance.
This has created a whirlwind of lawmakers trying to explore financial alternatives within the Obama administration aimed at helping the remaining 96 percent who may still lose their homes.
Reports show that currently there are 2 million housing entities in the United States in foreclosure or bank-owned with more surely to follow.
The government overall has been unproductive at saving homes from foreclosure. Sadly, the worse is yet to come according to Citigroup experts. Most financial analysts predict that there will be an increase of 8 million or more foreclosures in 2010 to 2011.
What does this have to do with short sales? Well, according to the National Association of Realtors, approximately 500,000 transactions in 2009 were short sales which represented almost 10 percent of all home sales.
What seems to have caught many by surprise is the about face attitude banks have adopted in that they are now readily accepting short sales in an increasing amount.
Further data shows that short sales almost tripled to 40,000 in the first six months of 2009, compared to the same months in 2008 as reported by the St. Louis Refinancing Group and the local lending community.
The Office of Thrift Supervision and the Office of the Comptroller of the Currency seems to feel that in reality there were 25 foreclosures started or completed for each short sale filed and completed.
“It’s really finally dawning on banks that they’re better off with a short sale. I think banks were in denial,” as Mr. Richard Green, the director of the Lusk Center for Real Estate at the University of Southern California in Los Angeles portrays.
Most homeowners don’t know this but there are a few benefits in doing a short sale. You remain in control of the sale as like any other home sale. And you can spare yourself the social stigma of having a foreclosure on your credit report.
But what if one wants to purchase another home. Would a short sale derail this future action? If payments were never 30 days late and no pay back was required by the lender, Fannie Mae guidelines may allow you to buy another home immediately or no longer than 3 years.
However, if your mortgage payments fell behind more than 30 days and a short sale was approved by the lender, you still may qualify to buy another home with Fannie Mae within 2 years.
But if foreclosure was unavoidable, you may qualify to buy another home within five years if the home was your primary residence with included restrictions. And if there were no restrictions in place, the wait is seven years.
Finally, for those investors out there where this house is not their primary residence, your wait would be 7 years according to Fannie Mae’s guidelines.
The market is changing mainly brought on by political pressure. Hence, the Obama administration is now advocating short sales as an alternative to imminent foreclosure.
In addition, the Treasury Department has recently laid out finalized guidelines for carrying out short sales under the Making Homes Affordable program.
Participating servicers under the new Home Affordable Foreclosure Alternative (HAFA) program have been urged by the administration to adopt short sales as a real alternative to foreclosure.
The HAFA program was a vital implementation for current homeowners that did not qualify for loan modifications under the Home Affordable Modification Program also known as HAMP.
Learn more about the best St Louis Mortgage loan. Stop by Floyd J. Tapia’s site where you can find out all about a St Louis Mortgage Refinancing and what a new home loan or refinancing can do for you.
Tags: business, finance, foreclosures, loans, money, mortgage, short sales, st louis home loan, st louis home loans, st louis home mortgage, st louis lending, st louis mortgage, st louis refinance, st louis refinancing
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