At NAR’s Mortgage Liquidity Symposium on May 10, a panel of banking and lending professionals faced an audience of hundreds of REALTORS from all over the U.S. There were some testy exchanges – in particular one panelist, Martin Eakes, Chief Executive Officer of the Center for Responsible Lending, claimed that we were at risk of going back to 1929 where, he felt, irresponsible and inappropriate lending practices were the order of the day. Some REALTORS in the Q&A session expressed frustration about short sales and appraisals.
Here in the South Bay, the Daily Breeze wonders if the problematic process for completing short sales are contributing to the slow housing recovery:
Realtors are increasingly blaming slow bank processing of short sales as at least one big reason for the weak housing recovery.The Los Angeles Times' columnist David Lazarus also asks why short sales are drawn out so much:
Short sales - which involve homes sold for less than the current mortgage - represented 26 percent of existing single-family home sales for March in Los Angeles County, the last month for which there is data. Short sales usually take several months or longer for banks to approve.
The situation has grown so problematic that the California Assn. of Realtors recently ran ads in newspapers statewide saying more needs to be done to assist homeowners on the verge of foreclosure by expediting the short-sale process.
"Horror stories abound from potential home buyers and Realtors forced to wait 90 or more days for a response to a purchase offer or being required to fax short-sale applications or other paperwork as many as 50 times," said Beth Peerce, president of the organization.