Banks expect a recovery from the housing debacle, yet can‘t grasp an understanding of a simple short sale transaction
It has been made public by the New York Times that the reason these short sales are taking what seems like light years to complete, is due to the fact that they don‘t understand the process. A short sale is when the seller‘s mortgage lender agrees to accept a payoff of less than the balance due on the loan. A short sale transaction should be a household term by this point, and the fact that our bank executives still don‘t understand the process is detrimental to the recovery of the housing market. David Knight, senior vice president of Wells Fargo Home Mortgage states that the lending industry has been on a crash course to learn about short sales since the housing market bust. He said, “The big challenge is none of us really understood the process”.
“What have the banks been doing all this time?” states Aram Afshar, President of Housing Assist of America ( Afshar says, “The problem lies with the banks. They are the ones who got us in this mess, and at the expense of the homeowners, are taking too long to get us out of it. We have mastered our part in getting these short sale packages completed with valid offers, but the delay is forcing some buyers to back out.” While lenders take their time to process these short sales, buyers are backing out, forcing homeowners to be foreclosed on. Short sales are on high demand as home prices have dropped drastically, leaving homeowners no solution to pay back the lender, if they run into financial hardship.
A short sale is the green light exit strategy for most homeowners who are upside down on their loans. As the banks see the exponential interest in homeowners short selling, they have shifted gears in attempting to help streamline some of these transactions. BofA Senior Vice President, David Sunlin, who manages short sales for the bank, said Bank of America has increased their staff and trained them thoroughly to update short sale borrowers and their agents. Leading short sale companies say they have yet to see this, but lets‘ hope for the good of all homeowners we see this change effective immediately. Afshar states, “I have many friends who are facing the same situation, and growing in numbers. I understand the pain that is felt at this time; our company is here to help those people and help clean the road ahead.”