Starting in April, mortgage lenders will be able to use a new product that will prevent short sale fraud and accelerate transaction times.
VerifiedShortSale will improve the speed of the short sale negotiation timeline by allowing the mortgage servicer to review offers from an agent representing investors and buyers first, rather than the offers going through a listing agent.
“For the first time, every offer for a property is received and decisioned without being filtered by a listing agent,” said Ronald Jasgur, president of Woodward Asset Capital, the parent company of VerifiedShortSale. “With our software, flopping virtually disappears, and every sale approval can be defended without question.”
A recent CoreLogic report stated that one in every 53 short sale transactions that are part of an extreme resale cost lenders unnecessary losses of $310 million a year. In a fraudulent short sale, it is estimated that the average loss to the lender is $41,500.
When a borrower is approved for a short sale according to loss mitigation rules or after loan modification fallout, the lender requires that all offer terms have to be submitted by the buyer using the VerifiedShortSale portal to be considered. By using this tool, agents are assured that their offer is received and reviewed by all parties including the bank.
The product establishes a paper trail of every offer presented by all the agents to eliminate any possibility of fraud or any missed offers. Rather than reviewing only one offer for a property, the lender now knows all of the offers for a foreclosed property.
“Our system still embraces and relies on the traditional two-agent sales process, which always nets the highest price,” Jasgur said. “This technology finally brings the timeline for resolving an approved short sale in line with that of a private sale. The quicker the sale, the smaller the loss.”
