New Legislation Regarding Short Sales…Is This The Help They Promised?

Have you ever thought about entering politics for the common good? Almost unimaginable would be my answer. The research required to attempt to understand one subject is immense. Add the staff, paid or volunteer, for aid in examining the number of issues that need attention in today’s world, mix in a good batch of legal language, and the initial objectives appear lost within the final regulation or law.

Last November there was legislation passed by the Congress of the United States and signed by the President that specified there be common paperwork drafted, agreed upon and to be used by all lenders involved in a short sale. That legislation required that the details of this task be agreed upon by the government and lenders, and that would aid and speed up the common real estate transaction known as “a short sale” by April 1, 2010.

March 16, 2010 and guess what “those who work within the real estate industry” have seen? Streamline and common paperwork has not been agreed upon, however paying the lender $1,000 to agree, paying the homeowner $1,500 to move, giving the investor a little tickle, and sprinkling a little fairy dust over the whole transaction is our government’s answer to making housing market all better. Not.

Real estate agents and brokers have the ability to report on the real estate market, forecast the market, but never control the market. Now turning a free wheeling supply and demand market into one governed and influenced by the Federal Government is dangerous. Three different buyer incentives, in a eighteen month span, have stopped a free fall, however new seller, lender, and investor incentives will prove fruitless because the law lacks the teeth to punish those delaying the processing of a short sale thereby delaying of a quicker real estate recovery and robbing each of us of equity building time. Does the federal government really think that $1,000 per house to the lender is going to change the lenders minds and not foreclose or co-operate with a short sale when they are loosing hundreds of thousands of dollars in each neighborhood in the country?

Either we face the situation now and let a free market economy make any required corrections needed, or we face further delays in any real estate recovery. Foreclosures will rain down upon us just like 2008 and 2009. Here’s looking to 2011.

Comments, please contact Don Khoury serving Fauquier, Culpeper, and Rappahannock Counties…540-341-8926 or info@realestatephd.com