CABOR Announces Support of Legislation Designed to Shorten Length of Short Sales
The Cleveland Area Board of REALTORS® (CABOR) is announcing its support of legislation designed to abbreviate the amount of time each servicer of a home mortgage has to respond to a mortgagor’s request for a short sale of the dwelling.
S. 2120, the Prompt Notification of Short Sales Act, was sponsored by Cleveland’s own Senator Sherrod Brown earlier this year. According to the bill, servicers would be required to respond in writing within 75 days to a mortgagor of a residential mortgage loan who has submitted a written request for a short sale of the residence. If the servicer does not comply, civil action may be taken.
A short sale is a transaction in which the lender, or lenders, agrees to accept less than the mortgage amount owed by the current homeowner. Due to the economic crisis, including high unemployment rates, and drops in home prices in communities across the nation, the number of short sales is increasing. According to the National Association of REALTORS® (NAR), a short sale generally costs the lender less than a foreclosure and may be a viable way for a lender to minimize its losses. CABOR encourages homeowners contemplating a short sale to check with their mortgage lender, attorney, or accountant regarding options and potential consequences associated with this alternative.
“Unfortunately, short sales are often riddled with delays and unrealistic current home values that can lead to buyers cancelling a contract on the property, which often then goes into foreclosure,” said CABOR Chair-Elect Joanne Zettl. “For years, REALTORS® have called for an improved process of approving a short sale, and we are hopeful that the Prompt Notification of Short Sales Act will do just that.”
Zettl went on to say, “If signed into law, this legislation would help streamline short sales by reducing the amount of time it takes to sell the property, improving the likelihood that the transaction will close, and reducing the number of foreclosures in our area, which ultimately benefits the lender, seller, buyer and community.”
CABOR recently joined Senator Brown in a press conference detailing the legislation and the impact short sales have on involved parties.
For more information or to find a REALTOR®, contact CABOR at (216) 901-0130 or online at www.cabor.com.