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Short Sale Mess

January 22, 2010

I feel badly for people who come to me and want to do a short sale on their home. It’s an alarming statistic at just how few of them really go through.

According to Brittany Dunn at DSNews.com: 

Although short sales are likely to increase in 2010, the jump in these transactions is unlikely to have any real impact on the housing market, according to a new study by Housing Predictor.

While more at-risk homeowners are turning to short sales as an alternative to foreclosure, Housing Predictor says the small number of short sales that are actually approved by banks represent less than 1 percent of all homes facing foreclosure. In the first half of 2009, only 40,000 short sales were completed, according to the most recent data available from the Office of the Comptroller of Currency shows.

In addition, Housing Predictor said only an estimated 8 to 12 percent of all homeowners who request short sales accomplish a completed transaction. Because lenders only write off short sales as a loss when a property is sold, this small percentage of completed transactions leaves a gaping hole in the troubled banking industry’s problem with short sales.”

Short sales remain a blight on the housing recovery and it’s such a shame because most people who would benefit never get the opportunity.

To read the full article you can follow this link:

http://www.dsnews.com/articles/surge-in-short-sale-requests-unlikely-to-impact-housing-market-2010-01-21

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