Jun 10
18
Principal Reductions Make Perfect Sense
The trend for loan modifications is shifting and evolving constantly. I believe the short sale syndrome will be replaced with principal reductions. Even the US Treasury endorses principal reductions as a better solution. Housing Wire supports this statement in recent article.
So far lenders have been providing been band aid mortgage modifications which result in “same problem, different year.” Property values will not escalate any time soon, as a matter of fact, it’s predicted it will take 30+ years to reach the values from 2004-2007.
It took three years for the short sale process to evolve where sellers now receive up to $3000 from the sales transaction for relocation assistance. When short sales began as an option to foreclosure, lenders did not embrace that concept and they foreclosed one after another causing real estate mayhem.
Principal reductions make perfect sense. However lenders have not quite embraced this concept either. My thought, it doesn’t hurt to ask, plead or beg for a principal reduction to current market value.
Related posts:
Agi Anderson, CDPE, compiled changes made to Make Affordable HARP refinancing program, October 2011 ~ to see if you qualify, just enter your name and email to request HARP guidelines. (make sure to check spam for email confirmation)
