Short Sales
By Kurt O'Keefe, Detroit Consumer Attorney on Jan 16, 2009 in Featured, Uncategorized
Fannie Mae has a pilot project to test short sale (definition by southern Oregon Bankruptcy Attorney Karen Oakes) as foreclosure alternative.
Fannie tries short sales over foreclosures
Fannie Mae recently launched pilot projects in Phoenix and Orlando intended to reduce foreclosures by pre-approving short sales, agreeing on a price and the loss it will take prior to a deal even being made. It is hoped the program will improve the popularity of short sales among real estate agents.
Property professionals initially had welcomed short sales but soon found the process to be a frustrating one–due to squabbling about the sale price and slow approval times by the mortgage companies–that often ended with no sale at all.
“Short sales have received such a bad reputation among real-estate agents that, as a portion of the overall mortgage market, they have gone down,” says Tom Popik of the research firm Campbell Communications, whose November survey of realty practitioners found that agents had to wait as long as 8.1 weeks to receive a response from the lender on a short sale. That was nearly double the 4.5 weeks the process took earlier in the year.
Fannie Mae’s pilot will focus on homes that are listed at less than the mortgage balance and carry a Fannie Mae-backed loan serviced by Countrywide Financial Corp.
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