Short-Sale Firms Solve Foreclosure Listings

Despite the low percentage of short sales approved by lenders nationwide, more and more short-sale companies have sprung up to help distressed borrowers save their homes from being added to foreclosure listings.

Short sales are often resorted to when borrowers can no longer afford to pay the monthly installments and do not like their credit records to be tainted with foreclosure listings. However, short sales must first be approved by the lenders before they are undertaken. Most lenders do not approve short sales because they lose from the low purchase prices.

Across the country, only about ten percent of short sale proposals are approved by lenders. Aside from the low prices, lenders oftentimes do not have the staff to examine the offers and when they do, they usually consider the proposed prices as too low to even approach their minimum limits. But if the lenders are presented with short sale proposals that are more acceptable than foreclosure listings, they approve the short sale route.

This is the reason many real estate brokers and foreclosure listings specialists developed systems to facilitate the short sale process for lenders, homeowners and prospective buyers. Florida-based Foreclosure Response Team is one company which touts to have such as system. According to the company's Michigan representative Cathy Sherman Bittrick, Foreclosure Response uses the expertise of lawyers, underwriters, real estate agents and title company specialists to fast-track the process of using short sales to help borrowers save their properties from foreclosure listings.

Fritz Schoenfeld is one of Michigan brokers who have been benefiting from the services of Foreclosure Response. Schoenfeld said the company has connections with large banks and runs a tracking system of short sale proposals that can be accessed by the banks.

Nevertheless, many lenders are still advising troubled borrowers to find ways other than short sales to save themselves from foreclosure listings and to contact them directly without using third parties if they insist on short sales. Eric Hendrickson, top executive of Grand Rapids' biggest mortgage bank Fifth Third Bank, said his bank prefer negotiating directly with borrowers because banks do not get the highest price if third parties such as short sale companies are involved.

Additionally, housing advocates and state and local officials have also been warning troubled borrowers about housing swindlers and scammers. Borrowers should back away from short sale firms that offer guarantees, charge upfront fees and demand that documents be signed over to them.

Joseph Smith has been educating buyers on the finer points of Foreclosure Listings purchase at TopForeclosureListings.com for over five years. Click here to visit and read more advice on finding Texas Foreclosure Listings.

Article Source: http://www.thearticleinsiders.com