New Government Bounty On Short Sales Pay Default Sellers $1500.00
December 3rd, 2009 Categories: Default News, Real Estate News, Shortsales
Government attempts to make short sales easier
The Obama administration laid out final guidelines on Monday that should make it easier for some financially troubled borrowers to sell their homes. The guidelines are designed to encourage the use of short sales, and it also makes it easier for borrowers to voluntarily transfer ownership of properties through a “deed in lieu of foreclosure.” Under the plan, borrowers will receive $1,500 from the government if they sell their homes for less than the amount of their mortgages. Mortgage-servicing companies will also receive $1,000 for each completed short sale. The program is open to borrowers who may be eligible for the government’s loan-modification program but don’t end up qualifying, or are delinquent on their modification, or request a short sale or deed-in-lieu transaction. The short-sale program is the latest addition to the Obama administration’s $75 billion foreclosure-prevention plan, which includes incentives for mortgage companies and investors to rework troubled
loans. The government first said in May that it would include short sales in the program, but it has taken months to finalize the details. Under the new guidelines, second-mortgage holders can receive up to $3,000 of the sales proceeds in exchange for releasing their liens. Investors who hold the first mortgages, meanwhile, can collect up to $1,000 from the government for allowing such payments. Borrowers who complete a short sale under the program must be “fully released” from future liability for the debt, according to the guidelines.
courtesy Chris McLaughlin
