Tuesday, April 6, 2010

U.S. Government Started its New Homeowner Incentives Short Sale Program

The U.S. government on April 5, 2010, started its new homeowner short sale incentive program to speed up the time-consuming process of selling a home in this way.
The government will now give $3,000 for moving expenses to homeowners who complete such a short sale, or if the owner agrees to turn over the deed of the property to the lender.
This program will also encourage lenders and is designed for homeowners who are in financial trouble but don't qualify for the government's mortgage modification program.
Owners will still lose their homes through this program.  However, a short sale or deed in lieu of foreclosure should not hurt a borrower's credit score for as much time as a foreclosure.
Advantage to lenders is that a home usually gets better offers through short sale than a foreclosure, and they avoid expensive legal bills, cleanup fees and maintenance costs go along with a foreclosure.
Short sales have been increasing and made up about 26 percent of the home selling market in Orange County, CA, during March 2010, as compared with 17 percent a year earlier.
Lenders previously did not calculate how much money they are willing to accept on a short sale until after they receive offers.  This new program is planned to increase efficiency for the process.  Buyers who submit an offer to purchase a home in a short sale should get a response within two weeks.  
There are restrictions for this program:
  • The home needs to be a borrower's primary residence.
  • Homeowners either have to be behind on their mortgages or on the verge of becoming delinquent.
  • Currently, the program is not available for mortgages owned or guaranteed by government control mortgage finance companies Fannie Mae and Freddie Mac.
However, Fannie and Freddie are expected to get involved with this program soon.

Harrison K. Long, Realtor & broker, Explore Group, Coldwell Banker Previews, Irvine, CA.  CA DRE #01410855.  ExploreProperties@gmail.com.  Lawyer - California State Bar Association member #69137.  National Association of Realtors, California Association of Realtors, and Orange County Association of Realtors.  Current Chairperson of Local Government Relations south committee at OCAR.org.  Newport Beach and Irvine area Realtor, broker agent and property information source. 

Be careful with this new U.S. government homeowner incentives for short sale program, and always contact your local and experienced REALTOR.

Posted via email from Explore OC Homes


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