Last month we briefly discussed Short Sales and Foreclosures. We reported that underwater borrowers are often in a quandary about what to do, and that over 70% of borrowers whose homes are foreclosed upon have never contacted their lender(s).
We also reported that lenders typically prefer short sales. Foreclosure sales not only typically cost more, but also result in lower sales prices. Net proceeds in a foreclosure are only 70%, on average, of that realized in a short sale. In addition as one reader pointed out, a home in the foreclosure process is more likely to be vandalized than a home in the short sale process. Unlike a foreclosed upon home a home in the short sale process is likely to be occupied and cared for – often by its owner-occupants.
The government’s HAFA guidelines are new in practice. Borrowers (sellers) who are considering a short sale should become well educated on HAMP, HAFA, the short sale process and what each of these mean to their specific circumstance. We can answer many of your questions in these areas, or point you in the right direction to pursue legal and / or financial advice if necessary.
Last month we did not discuss “Strategic Defaults”. Strategic defaults have been defined as defaults on home loans that take place even though a homeowner is capable of paying. They stop paying on their loan simply because they owe more than their home is worth.
A short sale may be a better alternative.
Your Home Team lists and closes more short sales than any other Central Valley agent or team. Our short sale processing is cost free to the seller and we are ready to help. Call us at (209) 471-6516 with any questions you may have. We also blog frequently about the short sale process and real estate trends.
The key to working out the problem is to act quickly.
Now that the California State Senate has passed SB 1178 Distressed Homeowners who have refinanced are one step closer to protection from debt recourse. The bill is currently before the State Assembly awaiting a vote determination. If it passes it would mean thousands more homeowners would become eligible to short sell their homes with their debt forgiven!
The following are market highlights for some of our Stockton neighborhoods. Click on the name of the neighborhood to view detailed reports and graphs for that neighborhood.
Average Sales Price
Days On Market
12 months’ sales
Avg Sales per Month
Months in Inventory
|All of Stockton|| 2,292 || $ 145,000 |
| 5,523 |
|Brookside|| 75 || $ 287,000 |
| 130 |
|Lincoln Village East|| 55 || $ 141,000 |
| 132 |
|Lincoln Village West|| 59 || $ 143,000 |
| 105 |
|Morada East|| 36 || $ 788,000 |
| 26 |
|Morada West|| 209 || $ 202,000 |
| 553 |
|Quail Lakes|| 38 || $ 128,000 |
| 74 |
|Spanos East|| 187 || $ 220,000 |
| 317 |
|Spanos West|| 57 || $ 219,000 |
| 120 |