Are mortgage lenders finally “getting it?” Since the beginning of the housing crash so many homeowners have expressed to me their frustration trying to work with their mortgage company to arrange a reasonable short sale of their real estate. These homeowners could not comprehend why the mortgage lender believed it was in their interest to foreclose on a property and then own the real estate instead of working through a short sale to dispose of the property to a ready and willing buyer.
Bloomberg online published an article indicating man banks now believe that moving property off their books through cooperative short sales is a better solution than foreclosure.
The article states:
Lenders have routinely delayed or blocked such transactions, known as short sales, in which they accept less from a buyer than the seller’s outstanding loan. Now banks have decided the deals are faster and less costly than foreclosures, which have slowed in response to regulatory probes of abusive practices. Bloomberg’s article says that banks are releasing personal liability and are even offering troubled homeowners cash bonuses up to $35,000 to find a short sale purchaser for their upside down property.
If true, this is welcomed news for homeowners stuggling to dispose of upside down properties. My question is, why did it take the banks so long to realized the mutual benefits of short sales?