“SOME” Banks are “Getting It” – Short Sales now 35% of Liquidations
This is a post courtesy of Investor Funding Blog by Ted Akers. If you’re a would be Short Sale Investor that is in need of transactional funding http://www.investorfundingsite.com/, outsourcing your short sale negotiations or just timely accurate info in the short sale arena visit his site for more info.
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A Research Note by Barclays Capital, indicates that short sales have been boosted by mandatory and voluntary foreclosure prevention efforts that have prevented mortgages from entering REO status. As federally-funded loan modifications made through the Home Affordable Modification Program (HAMP) grow and lenders are expected to hold off on foreclosure proceedings, the REO pipeline shrunk, according to BarCap researchers. The foreclosure prevention efforts have had the effect of “artificially” boosting short sales. “The artificial constraints to foreclosure auctions have resulted in a reduction in REO stock,” BarCap said. “As a result, the net volume of REO liquidations has also dropped.
As short sales are not affected by moratoria, their rate held up and their overall share in distressed sales increased. It has now risen more than 10 points from the lows to about 35% of overall liquidations. It remains to be seen if this increase will sustain itself once the large number of loans sitting in foreclosure are finally released into REO.” BarCap researchers pointed to the difference in severity seen in foreclosure and short sale scenarios as one of the drivers behind servicers choosing short sales.
HOWEVER, most experts agree that there is a looming shadow inventory of REO’s yet to come and that foreclosure numbers are likely to stay high thru 2011 due to specific types of outstanding mortgages, specifically Option ARM’s which have a greater liklihood of having values underwater when they recast. Information regarding the Barclays research was provided by Chris McLaughlin.
For low-cost Transactional Funding for Short Sale Back-to-Back closings visit Ted’s Transactional Funding website at: www.InvestorFundingSite.com Their fees are some of the lowest I’ve seen.
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And of course, if you’d like to discuss your personal situation to learn what options are available to you, give me a call at 702-204-3945 or you can contact me via email kenny@tfmcpartners.com or by leaving a comment below.
Kindest Regards,
Kenny Wagner
The Foreclosure Mitigation Company
P: 702-204-3945
