Banks Closing More Short Sales And In Less Time

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Short sales closing are finally increasing. Banks have been a bit stubborn over the last 3 years. Potential homebuyers had to wait months before they got an answer. Many homebuyers became so frustrated that they simply walked away from the deal and vowed never to deal with that particular bank again.

It is taking less time to close a transaction and the banks are willing to accept a price much lower than what is owed on the house. This is good news and it fosters hope for the housing recovery.

In the second quarter houses nearing foreclosure accounted for 12 % of total home sales, according to RealtyTrac. This number is up from 10% from the same period last year. Short sales were closed quicker as well. On average it took 245 days to close the transaction. This is still not an acceptable time. But it is a step in the right direction.

Some of the states that suffered the most during the housing crisis fared even better. California saw an increase in short sales to 25%, and Colorado saw 17%.

This good news mean that homeowners will avoid the high costs of going through foreclosure. In addition, they will be able to get a new mortgage in a shorter period of time than if they went the foreclosure route. Considering the overall housing market the discount was reasonable at 21% off the market price. If the homebuyer waited to buy a bank owned property then the discount could have been as much as 40%.

So what took the banks so long to realize that half a pie is better than no pie? Simple greed.

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