As of a couple of months ago, short sales accounted for nearly 15% of all home sales in the country. That number continues to grow as homeowners see short sales as a viable alternative to foreclosure. While foreclosures still make up ¼ of all home sales, that figure is down from the previous two years. The increase in short sales has meant a decrease in foreclosures. Next week, the number of short sales is expected to rise as new regulations are put in place by the FHFA for Freddie Mac and Fannie Mae.
The regulations require that Freddie and Fannie will have to respond to short sale buyers with a final decision within 60 days. They must also respond to initial short sale requests within 30 days of receiving a buyer’s submission. These new regulations will benefit the entire housing market by removing some of the risks for buyers, removing some of the lengthy waiting that used to accompany short sales. The impact will be felt most in states where judicial foreclosures take a long time, such as New York, where the process can take up to one year.
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