The California Association of Realtors today charged that lenders aren't doing enough to encourage "short sales" -- or transactions for less than the value of the mortgage on a property.
"Many underwater homeowners who have been hit by the recent economic crisis can no longer afford to stay in their home and just need to sell their home as expeditiously as possible are unable to largely because of the complex and cumbersome short sale process," association President Beth L. Peerce said today in a news release.
According to a survey by the group of 2,150 Realtors, 94 percent were involved in a short sale transaction last year. Less than 3 in 5 of short sales transactions were successful, and lenders in more than half of the cases took 60 days or more to approve or reject the deals.
Bank reactions: According to a Merc report, at least one big lender, Bank of America, reports that it has increased its staff and technology to make the short-sale process more efficient.
Bloomberg News is reporting today that BofA is separating its mortgage portfolio to create a "good bank, bad bank structure." Loans going into the "bad bank" are "delinquent or are expected to go delinquent over the next three years," Laughlin said. "As borrowers default, we'll evaluate them for a loan modification."
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