Another Short Sale Obstacle to Overcome!
Quality Title & Escrow recently hosted a Short Sale Workshop with Old Republic National Title Insurance Company. The workshop was designed to give Real Estate agents a better understanding of the lender’s perspective during the short sale process. We also discussed issues such as deficiency judgements, credit issues, and HOA. What we found was many of the agents who attended the seminar where experiencing much of the same issues on their transactions. Quality Title & Escrow has extensive experience in closing short sale transactions and so we tend to see alot of different issues that can arise on a transaction. We can all agree that HOA and Condo associations have been a pain in our side. It seems that as most lenders have implemented systems to better work with potential short sale transactions, associations have implemented systems to make it more difficult. It seems that way anyways! But, now we have another dynamic to consider. On a few transactions the buyer’s new lender has requested a report showing the percentage of homeowner’s that are in default in the subdivision of the subject property. A few associations are providing this information for no charge, but others are charging fees up to $150+ to get this information. What we have found is if the default percentage is too high then the new lender may not lend money to the buyer to purchase the home. Let’s look at the big picture….What could this mean for some local communities in central florida? If a lender chooses not to lend the funds now because of the default % what will they do when many of the homes are in foreclosure. We are still waiting to see what the lender’s will do with this information, but we have already had one lender tell the buyer to look else where.
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