Changes To The Short Sale Process In 2010

Many of you known that there was a short sale boom that occurred in January of 2009

, and in order to slow things down there are some changes to the short sale process in 2010. These changes are not negative, but they are designed to create balance for the lender and the homeowner.

The changes to the short sale process are under the HAFA guidelines, which essentially are trying to figure out if a short sale can be prevented. In addition, HAFA does ask for some items that your servicer will be accountable to provide as well.

The property should be listed with a real estate agent that is familiar with your area. One of the reasons I believe that this is the case, is because when a realtor is more familiar with the area they can be more strategic. Having a good realtor is critical, so when seeking one out, just make sure that they are familiar with the area you live in. Also, the servicer should allow any of your closing costs to be deducted from the proceeds of the sale.

There is also now a limit on the commission that can be paid to the realtor, not to exceed 6% of the contract sales price. If there is a contractor assisting the listing broker in the transaction, anything paid to them must be documented as well. Part of the changes of the short sale process, were simply put into place for accountability not just on a personal level, but for the lenders too.

There were also changes regarding the transaction, ensuring that the sale is done at arms length. The buyer must agree to not sell the home within 90 days. This change was put into place to help identify if short sale fraud was occurring, in which the perpetrators were buying the homes only to default on them very quickly and use that same property over again.

To ensure that there isnt faulty reporting to credit, there should be an agreement that the servicer will rightfully release you of the liability of repayment of the first mortgage debt. This is done to ensure that you dont have a foreclosure showing on your credit report, and that your mortgage should read as paid as agreed, or even as settled. However, keep in mind that any slow pay that you have will show up as it should if you did make late payments to the lender.

There are many more portions of the changes to the short process, and you need a professional that can help you determine what your options are. For more information, go to www.inlandempireshortsaleresource.com.

by: Mayer Dallal

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