Wells Fargo’s efforts to offer a short sale or a deed in lieu of foreclosure program to homeowners has continued to see some success for those who have been unable to acquire a permanent modification within the Making Home Affordable Program despite the fact that there has been some variations in this particular area according to recent Treasury Department reports. Data has tracked this information for the top servicers through the month of June 2011, but we have continued to see these offers still being made available here in September for homeowners who are in a position where a modification from HAMP is simply not available for their predicament.
Yet, Wells Fargo did see a decrease in the number of short sale and deed in lieu of foreclosure programs that had been tracked in total through HAMP as homeowners who had their trial modification canceled had stood at 3,506 in May, but that number decreased to 3,392 in June. However, we did see more positive results for homeowners who were not accepted for a trial modification but were offered one of these short sale or deed in lieu of foreclosure programs by Wells Fargo as the program totals between May and June increased by almost 1,000 homeowners in this particular category.
Obviously, not all homeowners have been in a position where they want to participate in a short sale or deed in lieu of foreclosure initiative by Wells Fargo or any other servicer for that matter, as these foreclosure alternatives that are either offered through programs like HAFA, directly through a mortgage servicer, or in association with certain state programs indicate that a homeowner will be leaving their property and this has not been an optimal choice for some. Numerous homeowners want to stay in their home no matter what program is needed, but in certain cases homeowners may request a short sale, as an example, when factors like negative equity may be a problem.
Wells Fargo has not been the only servicer to see issues arise with their homeowners when it comes to devaluation of property, but homeowners who may not be able to qualify for affordability opportunities potentially may benefit from a short sale as it will allow them to escape a situation where they owe more on their home than it’s worth. There have been instances where homeowners have seen such a large drop in their home’s equity that they feel it is likely to never return, or if it does it could take years, and even though a short sale may cause a financial setback in terms of a homeowner’s credit score, this has been one program that homeowners have opted to use.
While Wells Fargo and other major banks are still offering these plans, homeowners are still being urged by financial officials to make sure they look into programs that may help avoid the loss of their home through more affordable payments, as servicers like Wells Fargo are in a position to not simply offer modifications but may be able to help through foreclosure prevention alternative plans from different programs or sources that can help homeowners avoid foreclosure and having to settle for one of these alternatives.