John Rebchook is a former Rocky Mountain News reporter with more than 30 years of experience in writing and communications... Dave Liniger, co-founder and chairman of Denver-based RE/MAX International, applauds the U.S. Treasury Department’s guidelines announced late yesterday.
This is a move that Liniger and other RE/MAX executives have been promoting in Washington, D.C. for the past year.
Short sales, when a lender accepts the sale of a home at a price below the actual amount owed , increasingly are being considered by distressed homeowners as an alternative to more costly foreclosures.
Liniger has promoted a streamlined short sale process since foreclosures began flooding the market and has presented specific proposals to government officials. In the last year he made numerous trips to Washington, D.C. to encourage policies that facilitate short sale transactions.
Liniger believes that a streamlined short sale process would help many families avoid the trauma of foreclosure and help the housing market remain on the road to recovery.
“Short sales are absolutely critical as more and more people continue to face foreclosure and as our housing market struggles to recover,” said Liniger, who’s closing out a 28-city, cross-country speaking tour encouraging thousands of agents to become educated on the short sale process.
“While not all of our recommended changes were implemented,” Liniger said, “the Treasury’s new guidelines go a long way in incentivizing both lenders and homeowners to work together to keep homes from falling into foreclosure.”
Until now, the shorts sale process has been cumbersome for all involved and took upwards of eight to ten months for a transaction to close, he said.
But through the Foreclosure Alternatives Program and the new guidelines issued this week, short sale transactions will increase dramatically, which means less vacant and vandalized properties in neighborhoods across the country, Liniger contends.
He said the new guidelines enhance the short sale process in several ways:
· Speeds up the process – Mortgage servicers have 10 days to say yes or no to a short sale request, and after the transaction is complete, the borrower could be completely released from debt.
· Provides financial incentives – Borrowers are eligible to receive a $1,500 moving allowance if they sell their home through a short sale, and mortgage-servicing companies will in turn receive $1,000 for every completed short sale transaction.
· Limits Proceeds to second lien holders – Second mortgage holders can only receive up to $3,000 of the sales proceeds to release their liens and investors who hold the first mortgages can collect up to $1,000 for allowing such payoffs.
The program also facilitates the transfer of ownership by a borrower through a “deed in lieu of foreclosure,” another helpful alternative to assist home owners forego a foreclosure.
RE/MAX Associates are among the most versed in the industry in Short Sales and foreclosures, Liniger said. RE/MAX agents account for 58 percent of all the brokers with Certified Distressed Property Exper designations in the U.S., he said. RE/MAX continues to provide information to homeowners on Short sales through videos, articles and other resources available at this link.
Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.
One thing is that as part of the regulations the new buyers have to be in the house for 90 days, i.e. no easy way to fix & flip
[...] 6 months, however under the new guidelines banks will be required to inform the parties involved in 10 days. This is major legislation. I believe it will have much more impact than any of the previously [...]