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Bill could speed up short sales

September 17, 2010

WASHINGTON – Sept. 17, 2010 – Homeowners underwater on their mortgage may find relief through a bill strongly supported by the National Association of Realtors®. The bill, if passed by Congress and signed by President Obama, would force lenders to respond to a short sale request within 45 days.

The legislation, H.R. 6133, “Prompt Decision for Qualification of Short Sale Act of 2010,” was filed yesterday in Congress by U.S. Reps. Robert Andrews (D-N.J.) and Tom Rooney (R-Fla.).

“The short sale, which requires lender approval, is an important instrument for homeowners who owe more than their home is worth,” says NAR President Vicki Cox Golder. “While the lending community has worked to improve the size and training of their short sales staffs, they still have a long way to go on improving response times. As the leading advocate for homeownership issues, NAR believes that quicker attention to the short sales process is vital to help homeowners … as well as the nation’s economy.”

The number of potential short sale properties is rising across the country. According to NAR data, in the second quarter of 2010, four states have a significant share of properties with short-sale potential: Florida has 27 percent, Nevada 32 percent, California 28 percent, and Arizona 24 percent.

“Unfortunately, homeowners who need to execute a short sale are severely hampered because lenders (loan servicers) are unable to decide whether to approve a short sale within a reasonable amount of time,” Golder said. “Potential homebuyers are walking away from purchasing short sale property because the lender has taken many months and still not responded to their request for an approval of a proposed short sale price. Many consumers have mentioned that the delay in short sale price approval exceeds 90 days, and in many cases never arrives.”

Golder says she commends Reps. Andrews and Rooney for their efforts on the bill and urges Congress to pass the bill quickly.

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Comments

6 Responses to “Bill could speed up short sales”

  1. Roch on September 21st, 2010 3:15 pm

    Things are looking wobbly right now. I was reading some of Jay Brinkmann’s articles on CNNMoney and he was saying how 3.51% of people are 30 days behind on their mortgage.

  2. Mesa Short Sale on September 22nd, 2010 1:55 pm

    Thanks for posting this! It would be great if this passes. It would make a lot of our jobs in the real estate world easier to do if we didn’t have to wait so long for these short sales to go through!

  3. Mark Walker on September 22nd, 2010 8:43 pm

    I find it funny. Not only are the poor home sellers trying to rip off the bank and pay less, now they want the bank to spend extra money to make it snappy. Forgive me if I don’t feel for the home seller, I just think they need to be accountable for there actions.

  4. Flair Towers on September 25th, 2010 3:25 am

    Great news for the home seller. yes it will create more real estate job yet being a professional in this matter should be consider.

  5. Simon Campbell on September 28th, 2010 10:58 am

    To Mark, I would say, what would you do in the homeseller’s situation though? You buy a house and find that 3-4 years later it’s worth far less than you paid for it. And you’re in financial trouble because you lost a job or your 401k in the downturn. You’re saying you’d just chalk it up to a loss? I don’t think so, I think like anyone else, you would do anything they can to right your loss, including getting loan modification (is that what you mean by “rip off the bank”?) or lobby for easier short sales. I think its less about making it ‘snappy’ or making demands and more about making it not take over 13 months, the average time a BoA short sale takes, because of needless inefficiency.

    And, the faster we get short sale homes processed and off the books, the better for the larger economy, not just the homeseller.

  6. Seamless Gutters MA on September 30th, 2010 5:00 pm

    I really hope this bill passes soon. It is a sad situation when a homeowner can no longer afford to keep up with the payments on their home, regardless of how they got in to that quandary. The bottom line is that they can not afford to continue making payments, a ready willing and able buyer is in place, and the transaction just needs to proceed in a timely manner for all parties. I understand that the people buying the home want answers and will walk away if it takes way too long, but the people who are in the predicament also want conclusion to their dire situation and also want to move on with their lives. This would be beneficial to both parties, as well as the Realtors that work so hard to make these deals happen.

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