{"id":11498,"date":"2010-03-08T13:43:37","date_gmt":"2010-03-08T20:43:37","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=11498"},"modified":"2010-03-08T13:43:37","modified_gmt":"2010-03-08T20:43:37","slug":"obamas-short-sale-program-could-put-downward-pressure-on-home-prices","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/11498\/obamas-short-sale-program-could-put-downward-pressure-on-home-prices\/","title":{"rendered":"Obama’s Short Sale Program could put downward pressure on home prices"},"content":{"rendered":"

Mr. Obama’s latest program for the foreclosure crisis attempts to stabilize the market in a different way than his previous attempts.\u00a0 Before, the feds tried to keep people in their homes by negotiating reduced payments through loan modifications.\u00a0 Few people were able to use the programs and of those that did the rate of default recidivism was 50% within six months<\/a>.\u00a0 The “new” approach is to help those in trouble get out of their homes by streamlining the short sale process and adding requirements that will force banks to accept many more short sales.\u00a0 Basically, the feds will pay owners to sell at a loss and give them a little cash in the process<\/em>.<\/p>\n

Starting April 5th, hundreds of thousands of delinquent borrowers will be encouraged to sell their homes through this process.\u00a0 Since the basic laws of economics still apply, that flood of inventory at fire sale prices will create heavy downward pressure on other homes in their markets.\u00a0 Prices should fall.<\/p>\n

That’s just one problem with this approach.\u00a0 The Home Buyer’s Tax Credit was already a magnet for fraudulent filings.<\/a> The government mandated short sale process could be even worse.<\/p>\n

Short sales are \u201ctailor-made for fraud,\u201d said Mr. Lawler, a former executive at the mortgage finance company Fannie Mae.<\/p>\n

Last year, short sales started to increase, although they remain relatively uncommon. Fannie Mae said preforeclosure deals on loans in its portfolio\u00a0more than tripled in 2009, to 36,968. But real estate agents say many lenders still seem to disapprove of short sales.<\/p>\n

Under the new federal program, a lender will use real estate agents to determine the value of a home and thus the minimum to accept. This figure will not be shared with the owner, but if an offer comes in that is equal to or higher than this amount, the lender must take it. – MSN<\/a><\/p><\/blockquote>\n

With the high regard that the public holds for real estate agents, they should be a pinnacle of integrity<\/a> when it comes to setting values for lenders.\u00a0 Or, could that be a problem?\u00a0 I’ve found that real estate agents offer different values, at times in spite of the Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Mr. Obama’s latest program for the foreclosure crisis attempts to stabilize the market in a different way than his previous attempts.\u00a0 Before, the feds tried to keep people in their homes by negotiating reduced payments through loan modifications.\u00a0 Few people were able to use the programs and of those that did the rate of default […]<\/p>\n","protected":false},"author":55,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[15,5],"tags":[],"class_list":{"0":"post-11498","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-carnival-of-real-estate","7":"category-real-estate","9":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":7018,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/7018\/obamas-housing-rescue-plan-wont-rescue-housing-but-it-will-delay-the-eventual-recovery-of-the-real-estate-market\/","url_meta":{"origin":11498,"position":0},"title":"Obama’s housing rescue plan won’t rescue housing, but it will delay the eventual recovery of the real estate market","author":"Greg Swann","date":"February 21, 2009","format":false,"excerpt":"This is my column for this week from the Arizona Republic (permanent link). \u00a0Obama's housing rescue plan won't rescue housing, but it will delay the eventual recovery of the real estate market President Barrack Obama came to Mesa Wednesday to announce his new housing initiative. The location made for good\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":4588,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/4588\/wall-street-bailout-plan-to-include-more-than-bad-mortgage-debt-feds-to-absorb-unpaid-bar-bets-inadvertently-laundered-postage-stamps-unredeemed-soda-cans-and-insufficient-tooth-fairy-disbursements\/","url_meta":{"origin":11498,"position":1},"title":"Wall Street bailout plan to include more than bad mortgage debt: Feds to absorb unpaid bar bets, inadvertently laundered postage stamps, unredeemed soda cans and insufficient tooth-fairy disbursements","author":"Greg Swann","date":"September 22, 2008","format":false,"excerpt":"Totally absurd? Think twice:In the dark of night over the weekend when most people were snoozing, the Treasury dramatically expanded its bailout plan to include buying student loans, car loans, credit card debt and any other \"troubled\" assets held by banks. The changes, which were included in draft language that\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":647,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/647\/new-nar-policy-allows-objective-exclusion-of-certain-listings-from-members-presentations-of-idx-feeds\/","url_meta":{"origin":11498,"position":2},"title":"New NAR policy allows “objective” exclusion of certain listings from members’ presentations of IDX feeds . . .","author":"Greg Swann","date":"November 17, 2006","format":false,"excerpt":"This is the news from NARdiGras -- from RealEstateJournal.com:A revised policy approved by the National Association of Realtors this week may make it harder for discount brokers to draw attention to homes they list for sale. The policy, approved by directors of the trade group at a convention in New\u2026","rel":"","context":"In "Marketing"","block_context":{"text":"Marketing","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/marketing\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":6950,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/6950\/the-bad-news-obamas-housing-relief-plan-is-a-giveaway-to-lenders-not-homeowners-the-worse-news-it-wont-work-anyway\/","url_meta":{"origin":11498,"position":3},"title":"The bad news: Obama’s housing relief plan is a giveaway to lenders, not homeowners. 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