Here is the Ironic true story of how the Mortgage Bankers Association did a Short Sale! A typical “Do As We Say and Not As We Do” type thingy!
Irony of irony: Though I am a little late blogging on this story because this event actually took place February of this year, I think the moral of the story is still valid so let’s begin the tale! Once upon a time, one of the major organizations that complained about homeowners who opted for a short sale sold its D.C. headquarters as a short sale for $41 million dollars. That’s just about half of what they paid for their building about three years earlier.
The beginning of the tale: As the story goes, the organization called the Mortgage Bankers Association (AKA MBA); the trade group which represents more than 2,000 real estate finance companies bought the building in 2007 for just over $70 million. At the time, MBA said it would partly finance the property by leasing part of the space to other companies. It is said that they actually called the purchase one of the smartest moves they’d ever made.
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Strategic Default Vs. Strategic Short Sale; which one do you think is the best choice? – Part 1
There was an article on the Los Angeles Times website a few months ago that discussed the increasing problem of Strategic Defaults in the United States. I want to tell you why the study cited in the article is right and why this is a growing problem that is gradually reaching crisis proportions in America. Then on my next blog post (Part 2 of this series), I will show you why Strategic Short Sale is the solution.
This LA Times article cited a study conducted by Experian, one of the three national credit bureaus. They studied the credit files of 24 million Americans and discovered that “homeowners who have high credit scores when applying for a home loan are about 50 percent more likely than low-scoring borrowers to go into strategic default.”
Read MoreAttention Maryland Homeowners in Financial Distress! Treasury just made Short Sales a lot simpler…
An Obama housing initiative that I can totally agree with
On November 30th 2009, the Treasury department came out with a new set of guidelines called “Home Affordable Foreclosure Alternatives – Short Sale and Deed-in-Lieu of Foreclosure” or HAFA for short. It is the new addition to the Home Affordable Modification Program (HAMP) (HAMP is meant to help homeowners get their loans modified but in my view the HAMP plan has not been successful because most lenders were unwilling to reduce the principal amount owed by the borrowers especially when home values have dropped significantly – now enough of my opinion on HAMP and back to HAFA the reason you are reading my blog post).
Read MoreHello my name is Owen McGab Enaohwo
I'm a Maryland Real Estate Investor & Agent (Realtor) focused on Short Sales. Click to learn more...
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