Will banks short sell or foreclose?
In today’s market, it’s hard not to see all the for sale signs everywhere. From Gilbert to Tempe, from Fountain Hills to Paradise Valley. Even Scottsdale has seen a price decline of more than 45% since 2006. Either way, bank properties included about 15% of the current housing market and short sales account for another 47%. In these difficult times, who comes to the rescue? Bank of America? JPMorgan Chase? Wells Fargo?
Many of these banks do not seem to identify with the direct financial struggles of today’s real estate market. Without the right help, many homeowners will face foreclosure unprepared and with little education about the future impacts of this route. From what I can see, these banks don’t seem to be outpacing homeowners, and foreclosure predictions don’t seem to peak until next summer.
Bank of America appears to be trying to improve its handling of short sales through its new Equator system. They have been trying to revamp the way they work with homeowners in difficult situations. Make sure you are prepared for the worst if your loan is a Home Equity Line of Credit (HELOC), as they are not included in the Debt Relief Act of 2007. In most cases, some banks they go after the homeowner in both foreclosure and short-term. sale if they don’t sign a link release beforehand. For whatever reason, it seems that many banks do not want to help either new buyers or existing sellers who are having legitimate financial difficulties.
In order not to fall into the category of foreclosure, you must be well informed about your different options. The first step would always be to speak with your attorney and / or CPA to find out what options you have.
