Freddie Mac short sales up 600% since 2008!
The increase in short sales is self-evident in any MLS system around the country as the number of homeowners who are unable to qualify for loan modifications and do not want to be forced into foreclosures seek out a better alternative. Foreclosure or short sale? The choice is obvious.
Freddie Mac CEO Ed Haldeman announced the number of its short sales increase by 600% from 2008! An increase was certainly obvious, but 600%? And with HAFA still ramping up, that number is sure to increase in the near future.
In a statement put out this week, Haldeman said Freddie Mac is doing everything it can to prevent more foreclosures, and that short sales are becoming an ever-popular tool in situations where foreclosure is imminent and modifications have failed.
The rationale behind this increase in foreclosure is, again, obvious for distressed homeowners.
“Foreclosure alternatives like short sales and deeds-in-lieu help borrowers to avoid the stigma of foreclosure, shorten the waiting period before they can buy a new home, and may inflict less damage on their credit reports,” Haldeman said.
He added that these alternatives are also helpful to lenders and insurers. Citing several independent studies, Haldeman said banks lose more than $50,000 per foreclosed home or as much as 30-to-60% of the outstanding mortgage.
You don’t need media reports like these to know that short sales are increasing dramatically, just ask your local realtor who handles a lot of short sales whether their short sale volume is increasing.
