New Guidelines On Short Sales

As a REALTOR who's stayed in the business by adapting, I'm always interested in the newest ways to help my current and potential clients. I just read an article by Deborah Ball on the new Short Sale Guidelines from the U.S Treasury Department. RE/MAX has been diligently working establish these guidelines which make Short Sales easier and more efficient for all involved.

The Treasury's announcement Monday comes on the heels of more than a year's work by RE/MAX leadership to persuade federal lawmakers to address the need for a simpler Short Sale process.


The U.S. Treasury Department's long-awaited guidelines to streamline Short Sales will have a significant and positive impact on families facing foreclosure, according to RE/MAX International Chairman and Co-Founder Dave Liniger.

Here's the key to this exciting news: it simplifies procedures, provides financial incentives for Short Sales, and wait for it, wait for it - sets limits on the time frame lenders can take to respond. This is HUGE! Alphabet Soup version of this news is called: The Home Affordable Foreclosure Alternatives Program (HAFA), part of the Home Affordable Modification Program (HAMP).

It may not be perfect, but it's a huge step toward creating a much more attractive opportunity for people, something that is long overdue.



Here are some of the program's key guidelines:

• Lenders must respond to Short Sale requests within 10 business days of receipt of the offer package.
• The seller will be released from all liability for repayment of the mortgage debt.
• Subsequently, the seller is entitled to a relocation incentive of $1,500, which will be deducted from the gross sale proceeds at closing.
• The lender will be paid $1,000 to cover administrative and processing costs for a Short Sale or a deed-in-lieu.
• The property must be listed with a licensed real estate professional who does regular business in the community where the property is located.
• The lender is prohibited from requiring, as a condition of approving the Short Sale, a reduction in the agreed-upon real estate commission.
• The investor will be paid a maximum of $1,000 for allowing a total of up to $3,000 in Short Sale proceeds to be distributed to subordinate lien holders, or for allowing payment of up to $3,000 to subordinate lien holders.

RE/MAX leaders have been advocating Short Sale improvements for quite some time. In September, Liniger met with Housing and Urban Development Secretary Shaun Donovan and other U.S. housing officials to discuss the need for prompt action. A meeting with Sen. Harry Reid (D-Nev.) also moved the process along. RE/MAX Associates have embraced training in Short Sales and foreclosures. The network accounts for nearly 60 percent Certified Distressed Property Expert designees. That education will continue to play a vital role in this constantly changing market.



If you or anyone you know may benefit from these new guidelines, give me a call!