Banks can no longer afford to carry the cost of maintaining vacant properties waiting for the homes to be sold through the REO (Real Estate Owned) process. Lenders finally understand that it is far better and less expensive to allow struggling homeowners to remain in the property, maintaining the homes until a buyer comes along.
In addition to that, this news report dated July 29, 2011 states:
Wells Fargo says it has been making “enhanced financial relocation assistance offers” that can be as much as $10,000 or $20,000 to certain borrowers who choose to go through with a short sale or transfer the title back to Wells via a deed-in-lieu.
This extra incentive is being offered to distressed borrowers in Florida and other states where the foreclosure process is lengthening, a spokesperson for Wells Fargo explained. The exact amount of the relocation funds provided to individual borrowers varies based on a number of factors, the company says.
Wells Fargo noted that this type of additional relocation assistance is only available on first-lien loans that the company itself owns – which represent only about 20 percent of the loans Wells Fargo services. The company must follow investor guidelines for the remaining loans it services.
JPMorgan Chase is also offering a range of incentives to borrowers that agree to a pre-foreclosure sale “because if
we can’t work out a modification, a short sale is a better result for the borrower, the servicer, the investor, and the neighborhood than a foreclosure,”
Chase says the amount of the offer “depends on a number of factors” but declined to share specific details on how much money it’s been providing to short sellers. One agent in Florida confirms that he has indeed received a letter from Chase offering $20,000 to a borrower he’s representing in a short sale transaction.
Citi has confirmed that its average incentive offer is currently $12,000 for borrowers in cases where Citi owns the loan.
“Incentives are offered to customers experiencing financial hardship who need funds to proceed with the short sale,” a spokesman for the lender explained.
The amount, which is agreed upon upfront, varies according to the borrower’s individual circumstances and loan characteristics, Citi said. It is disbursed to the homeowner when the short sale is completed.
This new information concerning short sales indeed is an incentive to the homeowner to stay in the property until it is sold. Unfortunately many homeowners do not understand the short sale process. For more information, please visit: http://www.georgiashortsalehelp.com