Mortgage Debt Forgiveness Act close to being extended – Good News for Connecticut Short Sales

Most in the industry expected the Mortgage Debt Forgiveness Act to be extended.  It expired December 31, 2013.  The extension has passed the House and is now on to the Senate.

The extension would be retroactive back to December 31, 2013 and would help property owners who did a short sale in 2014.

For more info, CLICK HERE.

 

Senate Looks to Extend Mortgage Debt Forgiveness

The Mortgage Debt Forgiveness Relief Act, which had expired on January 1st, looks like it will be extended.  It might not be until December that the act is officially approved.  This is great news for property owners who wish to do a short sale.

It has been assumed that the Mortgage Debt Forgiveness Relief Act would be extended, but it is nice to see some proof that action is being taken.

For more info, CLICK HERE.

The Benefits of a Short Sale Over a Foreclosure

Short Sale Definition

A short sale is when a financial institution agrees to settle for a lesser amount than the total sum you owe on a mortgage, thus avoiding foreclosure.  Short sales have existed for a while, but it wasn’t until the recent downturn in the housing market that a “short sale” became household terminology.

If you find yourself in the position where the proceeds from selling your home fail to pay off your present mortgage, a short sale might be worth considering.  Before you commit to a short sale, you need to weigh your options.  Hiring an experienced short sale realtor in CT is a good place to start.

 

Eligibility for a short sale

In order to be eligible for a short sale…

  • You need to owe more on your mortgage (or mortgages) than your property is current worth.
  • You need to establish a genuine “hardship.”  For example:  A job loss or reduction in income, death, divorce, adverse medical condition, etc.  These things can help the bank verify that you aren’t able to bring in the same household income that you once did.
  • In almost every case, the lender will require that you are behind in your mortgage payments to be considered for a short sale.

 

Why does a short sale make sense?

Sellers who go through with a short sale generally do so to avoid foreclosure.  A foreclosure can adversely affect the homeowner in various ways.  A foreclosure leaves a negative mark on your credit report that will make financing larger purchase (real estate, cars, etc. ) much more difficult in the future.  A short sale also has a negative impact on a credit report, but a foreclosure is relatively much more negative.  A short sale will also be removed from your credit report sooner than a foreclosure will.

Not every realtor has experience with short sales.  Short sale realtors in CT may suggest a short sale for a number of reasons that are specific to each property owner.  Every case is unique.

 

The main advantages of short sale

A short sale specialist in CT should be able to explain the benefits of a short sale.  Some of those benefits include:

  • After a short sale, you might need to wait only 1 or 2 years before being able to obtain a new mortgage and purchase another property.  With a foreclosure, you often have to wait 5 to 7 years before you can obtain another mortgage.
  • A short sale  in CT has less of a negative impact on your credit score and credit report than a foreclosure.
  • You can often stay in your home longer, while you are working through the short sale process and weighing your options for your next move.
  • Working closely with your short sale specialist, will help you carry out the negotiation of your short sale.

NEW! Short Sale Market Updates

We’re starting something new! Each week we will be updating you on changes to the short sale market, including the total number of properties for sale in each town, and the number of those that are possible short sales and those that are bank owned. Our goal is to communicate the normalcy of this process in your area, and that you are not alone in struggling.

To the right, you can select the town you would like to see. On that page is a table that contains the short sale market history. Eventually, you will be able to see the trends in the market over time, but it will take a little while to gather adequate data. For now, here are the town comparisons for this week:

Town Total Listings Active Listings Possible Short Sales Bank Owned
Bethel 159 105 16 6
Darien 244 133 4 0
Easton 102 79 5 2
Fairfield 732 471 23 7
Greenwich 284 226 6 6
Monroe 158 123 21 3
New Canaan 342 263 12 5
Newtown 383 285 30 7
Norwalk 721 420 80 19
Redding 146 106 10 5
Ridgefield 389 262 25 4
Stamford 924 561 89 19
Trumbull 324 173 21 9
Weston 206 150 17 3
Westport 441 300 10 2
Wilton 261 169 17 3

*Numbers have been found through searching the Connecticut MLS

New OCC Standards Precede Temporary Lull in Foreclosures Sales

Wells Fargo, Citigroup, and JP Morgan cut back considerably on foreclosure sales in several states to adjust for the new minimum standards designated by the Office of the Comptroller of the Currency. These regulations have also been issued by the Federal Reserve, making them an industry standard. As of now, JP Morgan is back to functioning as usual, with Citi not far behind.

Check out the full article from American Banker.

 

Two New Short Sale Listings

Front

190 Scribner Ave, Norwalk, CT 06854

Listing Price: $1,295,000

Large Mediterranean-style house on 1.67 acres overlooking pond.
Located in private association. Recent addition completed in 2006.

Front

6 Sil Cam Dr, Danbury, CT 06811

 Listing Price: $399,000

 

New Short Sale Listing

Front 2

337 Wheeler Rd, Monroe, CT 06468

 Listing Price: $399,000

Great Convenient Location – 4 Br Expanded Cape On Lovely 1.12 Corner Lot, Master Bedroom Very Spacious W/ Private Bath And Sliders To Patio, 2196 Sf

New Listing by Milligan Realty.com – Norwalk short sale

SONY DSC

14 Phillene Drive, a short sale house in Norwalk, was just listed for $520,000.

Here are the remarks from the listing:

3 BR RAISED RANCH ON CUL-DE-SAC – 2.5 BATHS – 2 CAR GARAGE – LARGE DECK – POTENTIAL SHORT SALE – AGENTS SEE ADDENDUM FOR BAC.

 

To see the actual listing for this property, CLICK HERE.

Any questions on a short sale in Fairfield County?  Visit www.ShortSaleCT.com for more information.

New Listing by Milligan Realty.com – Norwalk short sale

4 Union - exterior

4 Union Ave # 25, a short sale condo in Norwalk, was just listed for $239,000.

Here are the remarks from the listing:

2 BR, 1.5 BATH TOWNHOUSE – PERGO FLOORS – CROWN MOLDING – CENTRAL AIR – POOL IN COMPLEX & SMALL PLAYGROUND – PETS ALLOWED IN COMPLEX – SHORT SALE SUBJECT TO BANK APPROVAL – AGENTS SEE ADDENDUM FOR BAC

To view the full listing, CLICK HERE.

Are you considering a short sale for your property in Connecticut?  Send us some info about you and your situation for a free short sale consultation:  http://shortsalect.com/apply-now/

 

 

Short Sales are 11 times more common since 2008

House under magnifying glass

Short sales have become a household name since the housing downturn.  In fact, homeowner’s opting for a short sale has become 11 times more common since 2008.  That trend looks to continue for at least the next couple of years.

DBRS.com, a market analyst, expects continued downward pressure on the real estate market.  They cite the weak economic recovery and looming shadow inventory (properties behind on their mortgage but haven’t been foreclosed on) as main reasons.

The shadow inventory is a particularly interesting topic since we just talked about that in our last blog post.  The shadow inventory in CT (judicial foreclosure state) will dissipate at a slower pace than ones in non-judicial foreclosure states.  Many owners to opt to do a short sale in CT have been living in their home for at least 3-6+ months without paying their mortgage.  Some sellers have been living in their home without paying their mortgage for over 3 years!  When the pressure eventually comes from the bank to foreclose on them, they go ahead with the short sale, although every case is different.  This has driven short sales to become 11 times more common than they were in 2008.

To read the entire article from DSNews.com, CLICK HERE.

Do you have questions about a short sale?  Check out our Short Sale FAQ page on www.ShortSaleCT.com.  Interested in talking with one of our Short Sale experts?  Send us some basic info for a free short sale consultation.