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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] The statistics on short sales Posted by CC in OC on April 05, 2009 at 0:34 AM In Reply to: Re: Our Story posted by Alex - CA on April 04, 2009 at 10:16 PM From National Mortgage News: Industry experts find that while short sales involve some loss and are time consuming, they represent a win-win loss mitigation tool servicers should embrace and streamline rather than avoid. Cheryl Lang, president of Integrated Mortgage Solutions, a collateral protection resource for the mortgage servicing industry, happens to be a believer in short sales as a loss mitigation tool, which among other things are a way to finally get house values right and help preserve neighborhoods. "We'll have the market back only if the prices stabilize. This is a different type of crisis we're in. We got to do things smarter and faster," she told NMN. "A short sale is a win-win solution for everyone involved. It's a way to find the true value of the home and keep those values, or what's perceived as true value, since that is ambiguous itself." The Obama housing plan, Fannie Mae and Freddie Mac cannot assist defaulted borrowers when they also face job loss. A deed-in-lieu is not a good option because it involves potential fines. So she finds it surprising that while a short sale preserves the borrower's credit and the property, it is not favored by large players like Fannie and Freddie. Although Fannie and Freddie posted a 76% increase in loan modifications in 2008, she said, the Federal Housing Finance Agency reported it engaged in just 16,718 short sales and took ownership of 145,183 homes. [16,718 is only 10.3% of total defaults! In other words, only 1 in 10 defaults turns into a successful short sale.] Yet, Ms. Lang is a realist. "There are a lot of roadblocks involved in the process, like loss and risk tolerance. A short sale cannot go through unless all parties accept some level of loss. "And a loss is a loss. In this case everyone should be flexible and realistic about it." There are first- and second-lien holders, private insurers, servicers and other parties. Some people choose to take a no-loss hard line, other times someone's ego gets in the way of closing a deal. She recognizes that every situation is different, but at the end of the day someone will have to deal with the defaulted property. *** Granted, in CA, a large percentage of loans are over Fannie/Freddie loan limits, but the success rate for short sale of non-Agency loans isn't much better, in my experience. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : From National Mortgage News: : Industry experts find that while short sales involve some loss and are time consuming, they represent a win-win loss mitigation tool servicers should embrace and streamline rather than avoid. : Cheryl Lang, president of Integrated Mortgage Solutions, a collateral protection resource for the mortgage servicing industry, happens to be a believer in short sales as a loss mitigation tool, which among other things are a way to finally get house values right and help preserve neighborhoods. : "We'll have the market back only if the prices stabilize. This is a different type of crisis we're in. We got to do things smarter and faster," she told NMN. "A short sale is a win-win solution for everyone involved. It's a way to find the true value of the home and keep those values, or what's perceived as true value, since that is ambiguous itself." : The Obama housing plan, Fannie Mae and Freddie Mac cannot assist defaulted borrowers when they also face job loss. A deed-in-lieu is not a good option because it involves potential fines. So she finds it surprising that while a short sale preserves the borrower's credit and the property, it is not favored by large players like Fannie and Freddie. Although Fannie and Freddie posted a 76% increase in loan modifications in 2008, she said, the Federal Housing Finance Agency reported it engaged in just 16,718 short sales and took ownership of 145,183 homes. [16,718 is only 10.3% of total defaults! In other words, only 1 in 10 defaults turns into a successful short sale.] : Yet, Ms. Lang is a realist. "There are a lot of roadblocks involved in the process, like loss and risk tolerance. A short sale cannot go through unless all parties accept some level of loss. "And a loss is a loss. In this case everyone should be flexible and realistic about it." There are first- and second-lien holders, private insurers, servicers and other parties. Some people choose to take a no-loss hard line, other times someone's ego gets in the way of closing a deal. She recognizes that every situation is different, but at the end of the day someone will have to deal with the defaulted property. : *** : Granted, in CA, a large percentage of loans are over Fannie/Freddie loan limits, but the success rate for short sale of non-Agency loans isn't much better, in my experience. [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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