Realty Group Seeks Better Short Sales
The largest state organization of real estate professionals in the country has urged the mortgage community to improve the short-sale process, suggesting, among other things, that they set realistic time frames in which to make their decisions and then stick to them.
In a letter to the nation’s four top lenders and servicers, Beth Peerce, president of the 160,000-member strong California Association of Realtors, said that change in the short-sale process is critical.
“The housing market recovery is in everyone’s best interests, and your urgent focus on these issues will help achieve that end,” Peerce wrote in her letter to JPMorgan Chase, Citigroup, Bank of America and Wells Fargo.
CAR is the largest state affiliate of the million-member National Association of Realtors.
Besides calling for strict time lines, the group made these recommendations:
• Make it clear to both buyers and sellers about who has the final say-so, the owner of the loan or the servicer.
• Respond to a borrower’s short-sale request within 30 days. If the offer is turned down, explain why and how the issue can be rectified.
• Upon request, pre-approve a short-sale price prior to the property being listed for sale.
• Provide an advanced, comprehensive list of information needed to gain a short-sale approval and do not “restart” a file from square one if a particular item or items are missing. Allow for the correction and continue the process without bumping a short-sale request to back the end of the line.
• Designate a single point of contact who can inform the borrower about the file’s status and shortcomings, and who can assist in any problem solving that may be necessary.
• Speed up processing. Often, a single home goes through the process numerous times, a situation that can takes months and result in buyers losing interest and moving on to other properties, explained Peerce.
• Increase the amount of the proceeds received by junior lien-holders, another common reason short sales disintegrate.
The CAR president acknowledged that short sales can be expected to be a big part of the state’s real estate landscape for years to come.