Tip 12-2012: More Short Sales & REO's in the Future?
The number of Borrowers in default
unfortunately continue to rise. One answer to overcoming this trend is
more successful short sales. However,
with the possibility of an unsuccessful short sale or the homeowners
simply walking away, the number of foreclosures will continue to grow.
This means more REO properties ("Real Estate Owned" by the foreclosing
banks) offered for sale.
Today's
Purchasers, Realtors and Lenders should not be apprehensive of short
sales and REO's. These types of transactions are going to be part of
the real estate landscape for many years to come. In fact, some recent
projections predict that by the end of this year, 50% of all
transactions will be either short sales or REO's. In other words, one
out of every two sales will require a third party lender or quasi
government agency to agree to the terms of the contract.
Although
these third party banks and quasi government agencies usually cause
additional complexity and add time to the transaction, there are some
improvements occurring. Remember, these banks, Fannie and Freddie do
not want to own troubled real estate. They would prefer not to
foreclose at all. If they have to foreclose, then they will want to
dispose of the REO property as soon as possible through a sale to a
third party.
All
Realtors and Lenders need to realize that they will probably have to
deal with short sales or REO transactions in the future. These type of
transactions can be handled and closed successfully. Get as much
education as you can, and prepare the purchaser for what to expect. Good
Luck!!
Contact me at 434-951-0858 or Tucker@TGBLaw.com if you have questions. Thanks for allowing us to send you this email.
Please feel free to share this tip on your social media sites (buttons above.)
William D. Tucker, III
Charlottesville 434-973-7474 | Lake Monticello 434-589-3636
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