Californis Association of Realtors® makes recommendations to lenders urging for more action.
C.A.R. sends letters to lenders, urges more action.
C.A.R. knows that short sales will be a part of the California real estate landscape for years to come, and is highly aware that lenders’ requirements have made closing these transactions a difficult process. To that end, C.A.R. recently sent letters to the heads of the nation’s largest lenders – JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo – calling them out on their short-sale practices and making recommendations on how the process can be improved for all parties involved.
In the letters, C.A.R. made the following recommendations:
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Provide realistic time frames and then meet those time frames.
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Provide a comprehensive list of information needed upfront.
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Provide approval requirements upfront that, if satisfied, would assure the borrower of a short sale approval.
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Disclose whether a loan you service is owned by you or if others own it. If others own it, provide time frames for approval. Be clear on who has final authority.
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Pre-approve the short sale and price upon request, prior to the property being listed.
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Review and respond with an approved offer to a borrower’s short sale request within 30 days of receipt of the request. If rejected, be explicit on why, and how, it can be corrected.
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Do not “restart” files from square one if something is missing. Allow the correction and continue, without bumping it to the back of the line.
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Have a person available who can inform the borrower about the file’s status and shortcomings, and who can assist in problem-solving.
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Increase the speed of processing files. Often, a single home goes through the process numerous times, resulting in months elapsing and buyers losing interest. The pre-approvals and cumulative files discussed above will dramatically assist this effort.
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Increase the amount junior lienholders receive. This is a common reason why short sales fail.
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When the property is cleared for sale, be explicit that there will be no recourse on the notes as required by SB 458, which now is in effect.
C.A.R. will continue to remain vigilant in the arena of short sales and keep members updated on our progress.
Article derived from: www.car.org
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