Finally, good news is on the horizon for anyone trying to sell a home. The overly complicated short sale transaction may be simplified by a new federal plan. The agency behind Freddie Mac and Fannie Mae is working hard to at the very least minimize many of the major obstacles related to short sale transactions. The best news, the new changes may be put into effect as early as the fall of 2012.
What Does This Mean For Home Sellers
Currently, many home owners face foreclosure as their only option. Due to the exaggerated process, a short sale is often taboo in real estate. There are far too many terms, conditions, paperwork and agreements for many to find the alternative beneficial. Add to this the length of the process and a short sale may not even be possible. While a short sale actually helps the home owner in many ways, it is often not even put on the table as a solution to foreclosure. With the possible new changes, this could all change and make lien holders more agreeable to the sale.
A Look At The Changes
The Federal Housing Finance Agency are seeking input from a variety of lenders, realtors, housing counselors and other real estate professionals on exactly how the short sale process can be sped up on Freddie and Fannie connected loans. The current deadline to finish reviewing the process is June 30. The final process should be announced around the end of September.
Five main areas are being looked into. Second liens is the first on the list. Second mortgages often equal the lengthiest short sale transactions. Banks do not want to report the loss they are likely to take and delay the process by creating unrealistic terms.
Next up is mortgage insurers. Currently, mortgage insurers can continue their negotiations over short sale claims until home sellers give up. The FHFA plans to create new rules to eliminate this problem. Mandatory timelines would help speed up the short sale process by setting a set time frame for short sale responses.
The final two areas include valuation issues and staffing. The idea is to help limit negotiations by setting minimum terms upfront. With better staffing in all areas of the short sale process, short sale transactions would be handled faster. Read more about the potential changes in the original article from Inman News.
Home Sellers In Baltimore
If you’re confused as to what a short sale means to you as a home seller in Baltimore, it is vital to learn as much as possible about short sales and even possible alternatives. If you’re facing foreclosure, you need to know all your options before proceeding.