Short Sale Reform – Home Affordable Foreclosure Alternative Plan
I don’t recall reading this last week but I am sure it will make some very irate. ” I find it interesting that before the plan even went into effect today, the Administration upped the incentives a week ago, doubling the amount of cash to $3000 offered as borrower “relocation expenses” and juicing the payoffs to the others as well. Of course they want to push short sales because of course they know that their modification program isn’t working as planned.”
The reason the program will struggle and probably be as helpful as the other programs is because the banks need to “weigh what’s going to save them the most money and cause them the least bleeding on their books.” It’s all about their balance sheet and since the mark-to-market accounting rules were changed to let banks keep loans on their books as “performing” even if the values of the underlying properties have fallen below the loan amount. I guess time will tell.