My sister called yesterday from International Falls in Minnesota. She asked how to find Winnipeg in Manitoba, Canada -- whether Winnipeg was east of west of International Falls. I wanted to know what the heck was she doing in International Falls? She lives in Minneapolis. Seems she grabbed my niece's and her passports, jumped into the car and took off for Memorial Day weekend.
What kind of person drives 5 hours without any idea of how to get to her destination? Oh, wait, that's my sister we're talking about. The same person who installed a basement egress window without protection to prevent flooding.
Google maps gave me the directions to Winnipeg, which I repeated to my sister over the phone. Sadly, it's another 5 hours to Winnipeg from International Falls, and she was only halfway there. I suggested she spend the night in Kenora and make her way into Winnipeg in the morning.
See, to have a plan, it helps to have a Point A, a Point B and a map that shows how to get from one to the other.
This makes me wonder about Obama's foreclosure alternative plan that favors short sales over foreclosures. We're at Point A -- we have tons and tons of foreclosures, foreclosure activity was up 32% for April, according to RealtyTrac. We'd like to be at Point B -- where homes in default are quickly sold, without going through foreclosure and sitting vacant for months.
I don't see the map that gets us there.
The modifications to Obama's Making Homes Affordable plan asks for voluntary participation and the sets forth the following compensation for a short sale:
- Lenders can receive a $1,000 incentive from the Treasury to do a short sale
- Borrowers can receive up to $1,500 to relocate after a short sale.
- Junior lien holders can receive up to $1,000 from the Treasury to release the loan, facilitating the short sale.
If this plan will help Sacramento home sellers avoid foreclosure and complete a short sale, I'm all for it. But until I see a road map that clearly outlines how we will get from Point A to Point B, I have my doubts.
The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com
Photo: Big Stock Photo
Elizabeth Weintraub is an author, columnist for The New York Times'-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout Sacramento. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you.
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Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout the four-county Sacramento area. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. Broker-Associate at Lyon Real Estate. DRE License # 00697006.
The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com.
Lyon Real Estate is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.
Photo: Unless otherwise noted in this blog, the photo is copyrighted by Big Stock Photo and used with permission.
The views expressed herein are Weintraub's personal views and do not reflect the views of Lyon Real Estate.
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I think the Short sale solution is 100 percent preferable. Banks save. Consumers save on their credit and we do not have boarded up houses. But the process is so long and is broken for sure.
Short sales are very long process and unpredictable. I have had many listing in the past where we could not complete a shaort sale and the home ends up selling as a foreclosure at a much lower price as a bank owned property.
Short Sales are a long process but win-win for everyone involved if they have the patience.
Ohhh! While I am a fan of Obama - my first question with this plan is .... If approved when will the bank get on board? The banks right now, in my opinion don't give a hoot what the PLAN is (neither Plan A, B, C or AA BB has worked thus far -- due to the banks). Trying to ignore the damage that going through with the foreclosures and literally putting people out of their homes already (what the number now?) -- to just go backwards and try to put short sales as the majority is going to be a confusing and awkward thing to do -- and good luck with it.
My heart goes out to the ones that already lost their homes because a bank, MI or investor would not approve the short sale in the first place.
Obama, please make these banks change their process and approve the short sales that are on the books already. Then I'll believe that this new plan will work or should work.
Great post - as usual.
Most of my short sales get approval within 6 to 8 weeks. If timed correctly, a buyer can begin the loan process about 2 weeks before approval, which means the transaction can close in about 2 months from offer inception. But there are also those delightful banks such as Countrywide and Bank of America, which routinely lose files, outsource imaging and cause unimaginable delays.
Rosemary: The banks will get onboard when there are appropriate pressures applied and financial incentives to do so.
Elizabeth, I am all for a viable solution to streamline the short sale process! I am going to pick your book up today, it came in!
Hi Elizabeth, and of course this proposed plan is an unproven plan. The government lately just keeps throwing dollars at everything and sees what sticks. Time will tell if it will help the foreclosure market or not. Hope your sister made it to Winnipeg ok.
The voluntary home loan modification loan program seems to have no map for my closest friends... something that was supposed to help keep them out of default as well as help them stay in the home has turned into a long draug out nightmare with no answers or response to them- hence no road map and if there is one it is a secret road that the bank has not told them about. 80 days into a loan mod with NO CONTACT from the loand modification company - other than the customer rep who answers the phone to say "you'll have to wait for the analysist" to call you...we're sorry they are behind with all the apps.... so guess what now these people are in default... so much for the help and the plan and the map... someone forgot to give out the maps to the bank maybe??? or make the map or it was a map with only dead end streets....??
As far as vacations go I could be related to your sister. I've done that, just got in the car and drove somewhere without know where "somewhere" was when I left home.
As far as Obama's new plan, hope it works better than the last one.
I am afraid the map is being drawn as they proceed and I don't believe they have a clue on the end result.
Elizabeth,
When you read comments and read the word "hope: so many times, it just shows that there is no clear plan.
Looks like they are still betting on winning a lottery from the Lord
Lots of confusion out there...and I think your sister and my sister are twins...how about putting $50,000 in rehabbing a house and THEN buying it....? I thought it was the air in California...a brain freeze thing...but some sisters just come that way....Happy Memorial Day !
Hi Elizabeth... I agree completely with your comments. I am "hopeful" but as they say, the proof will be in the pudding. Speaking of pudding, I could go for some chocolate pudding about now! :)
You know the Obama administration has a firm grip when millions of homes with defaulted on loans are sitting idle, often with "owners" still living in them. Last year, these folks would have been on the street but a white house imposed freeze on foreclosures is a cornerstone of a huge "shadow inventory." How long the administration can keep their finger in this dike is anyone's guess but when the wall gives way, we'll have conditions for a perfect storm of excess inventory.
Just try a search on "housing bubble smackdown"