Short Sales to Increase Over Next Few Years

Short Sales to Increase Over Next Few Years

Short sales will remain prominent over the next several years as foreclosure inventories increase and remain somewhat stable. With the prolonged foreclosure timelines along with enhanced processes and technology, more short sale closings will be completed in the next 2-3 years. For now, the average foreclosure timeline is 587 days, and the number of short sales is expected to increase by 25% next year.

In April of 2010, new short sale laws were implemented which have resulted in an incentive program. The new laws provide more incentives for secondary lien holders to consider approving the transaction in order to avoid foreclosure. Prior to this change, secondary lien holders were not guaranteed a percentage of the proceedings and had little incentive to sign in approval. Due to the change in the laws, secondary lien holders are more comfortable approving the short sale on homes in default and homeowners can avoid foreclosure consequences.

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Housing Assist Coldwellbanker