subject: Housing - A Long Road To Recovery. Short Sale An Option For Many. [print this page] Please note - We are not trying to bring down the public or persuade individuals that a short sale is their only way out. However, I think it is important for many to know that some options will not work and sometime government entities should just not be relied on. It is on the public to seek out education and the right professionals to assist them. It is survival and figuring out the best options for you and your family.
I have many friends, associates and others that have contacted us about information on short sales in South Florida as kind of a last resort before foreclosure... I encourage many to try and renegotiate the loan(s) that they have to see if they can come up with a more affordable scenario even if it is a rental property to a break even scenario. Unfortunately these individuals are coming back 60-90 days later and exercising their right of a potential short sale due to a denial of a modification.
Here are some quick quotes from the article out by Bloomberg by Fannie Mae CEO (Michael Williams) - September 9, 2009 (Source - Bloomberg).
Foreclosures will continue to climb this year, Williams said, putting pressure on home prices as mortgage companies work through a backlog of property seizures that had been suspended earlier this year as part of efforts to provide struggling homeowners with relief. While homes are selling faster, the inventory of foreclosed properties and unsold homes remain at "exceptionally high levels," he said.
One in every 10 mortgage borrowers is behind on their payments and one in every 25 homes is in foreclosure, he said.
Homeowners have lost 40 percent of their equity, making it difficult for many to refinance, he said.
Some borrowers, as a result, are ineligible for government programs to refinance into lower rates. More than 1 million delinquent loans are ineligible for President Barack Obama's loan modification program because the debt was used to finance second homes or exceeds the program's loan limits of $729,750.
"And not every borrower is taking advantage of the program," he said. Only 29 percent of the people who have received solicitation letters have responded, according to Williams. He said borrowers who aren't participating are skeptical of the program, have only just learned about it, have lost their jobs or have already abandoned their homes.
Regulators seized Fannie Mae and smaller rival Freddie Mac one year ago amid concern that their capital wasn't sufficient to withstand a surge in mortgage delinquencies. The companies, surviving off a $400 billion lifeline from the U.S. Treasury Department, have since been thrust into a leading role in Obama's homeowner rescue plans, which include offering low-cost mortgage refinancing and waiving some loan standards.
The companies, responsible for $5.2 trillion in U.S. residential mortgage debt, have booked a combined $165.3 billion in quarterly net losses in the past two years and have received or requested $95.6 billion in taxpayer aid since November.
I am sometimes at a loss for words. I think we are headed into a long period of downturn even with media talking about "Housing market stabilizing" and "House pricing increasing" -What they do not say in big print is home prices have increased due to an acute period of time for a high demand of real estate in particular areas. And yes people are buying - And there are buying frenzies in Southwest Florida foreclosures and short sales. However, I expect we will see more abundant foreclosures and short sales especially in South Florida.
