Bank of America to put short sales ahead of foreclosures
Bank of America, previously the most difficult bank to work with to get approval for a short sale, has taken a 180 degree turn and has now instituted a policy of liquidating as many assets as possible before foreclosure according to Matt Vernon, short sale and REO executive at BofA.
"We're going to do everything possible to liquidate property prior to foreclosure," Vernon said. "REO will still be available, but we will do everything we can to do short sales." Vernon said the goal is to get as close to market value as possible, or even over market value. "Short sales is not an investment strategy to get homes on the cheap," he said.
Read more at Housing Wire.
But as you read through the above quote, you can see there is both good news and bad news for Charleston home buyers interested in getting a deal on short sales but obviously some good news for Charleston home sellers who want to sell their home via a short sale.
The good. For those home owners who are distressed, it will be easier to get a short sale approved than before. Please note that you still have to have a legitimate hardship and that there is a load of paperwork that must be provided to the bank but the odds of third party lender approval will improve.
For home buyers who have written contracts on short sales only to wait endlessly for lender approval and in many cases, withdrawing their offer after months of hearing nothing and getting nowhere, the process will be quicker and more likely to close. The bad news is in these critical words, "the goal is to get as close to market value as possible, or even over market value. Short sales is not an investment vehicle to get homes on the cheap." (emphasis added)
Let's address market value for just a moment. I have seen lender owned homes that are well priced below market value and I have seen lender owned homes that are priced as if the home is superior to anything else in the neighborhood. Generally the first will sell quickly while the other languishes on the market only to be reduced in price over time just like any other overpriced listing (I just showed a lender owned home last week to a client that has been on the market for almost two years).
But short sales have generally been listed at almost "too good to be true" prices and based on the above, that might not be the case any longer.
If you want more information on selling your home as a short sale or buying lender owned (REO) properties or short sales for sale in the Charleston real estate market, I am certified as a Short Sale and Foreclosure Resource (SFR) by the National Association of Realtors (NAR) and would be happy to help you, just contact me.
Photo of shorts on clothes line shamelessly stolen from my friend, Larry Cragun at RealEstateUndressed.