Reports here in the middle of June concerning short sales have shown that there may be some shifts in how these particular types of home loan opportunities are becoming available for new homebuyers and how homeowners are escaping a formal foreclosure when they sell at a loss. However, there are still questions which remain over whether short sales should be used on such a wide scale by homeowners, but new practices that have been brought to light could potentially help reduce the amount of homes that are simply sitting empty when a homeowner can no longer afford their mortgage payment.
Information that has recently been made concerning short sales was felt to be on the horizon earlier this year, due to the fact that it has been reported that there are some banks that are helping homeowners either find buyers or are offering information on short sales to realtors, in the hopes of getting these homes filled before they simply become another piece of inventory sitting in the housing market and potentially draining home values in their area. It’s understandable that, when banks start working with homeowners and home sellers in the area of short sales, the likelihood that these properties may be bought could be increased and this may help with backlogs of inventories that have been causing problems in areas where financial distress for homeowners has been quite detrimental.
The question though is whether homeowners should resign themselves to a short sale before exploring all of their options, as some of these men and women have not only experienced financial hardships but have seen the property value of their home decrease and, when they qualify, are not only able to rid themselves of an unaffordable mortgage payment but are getting rid of an underwater home as well.
A few months ago it was stated that homeowners will likely see a decrease in their credit score that is comparable to a foreclosure when they participate in a short sale, so the benefits that homeowners thought they were gaining by selling their home at a loss are not as advantageous as had previously been hoped. It’s understandable that there are homeowners who are left with no other options and thanks to programs like the Home Affordable Foreclosure Alternatives initiative and certain programs within the Hardest Hit Fund in specific states do offer these short sale or deed in lieu of foreclosure opportunities for homeowners who cannot make ends meet.
However, homeowners who are worried about their credit score or who may simply be in a position where they would rather not sell their home at a loss are being prompted to explore not only home loan modification options but the programs from the Hardest Hit Fund or even proprietary mortgage assistance directly from their bank. While each homeowner’s position will be different, there are no guarantees and homeowners have still faced the need to short sell their home after exploring these options in some cases, but for those who are looking to avoid damage to their credit and face the predicament where they will have to wait to reenter the housing market may want to exhaust these foreclosure prevention opportunities before resigning themselves to a short sale option.