The Foreclosure Report

Short Sales Pick Up In Sacramento

A Sacramento area television station has this report on short sales. "Lenders are reporting more home owners are defaulting on their mortgages. But before those defaults turn into foreclosure, some sellers are turning to short sales, if lenders agree."

"Home owner Gloria Romero bought her three-bedroom home in North Sacramento last year but has to sell it. She has listed the home for $250,000 hoping to cover her mortgage balance. Thursday she received her first offer, $219,000."

"So, Romero is turning to a short sale instead of letting the bank takeover the house. A short sale is when the lender accepts an offer that is less than the current balance. Not many lenders are accepting these negotiated transactions because it affirms the real estate market has settled from its accelerated growth that drove prices up in the first half of the decade."

"(Realtor) Scott Williams says his office has gone from no short sales in seven years to nine such transactions in the last few months. 'Back in the '90s, I became the short sale guru in Sacramento and did several hundred of them,' Williams said."

"The realtor says he's working with another home owner in Natomas who has to move and has received an offer of $399,000 for her home; about $60,000 less than what she owes on it. Like Romero, the home owner hopes the lender will agree to let the house sell for less than the mortgage balance."

"Even though a short sale will become part of these homeowners' financial history, Romero says it's better than a foreclosure. 'I don't want my credit to be really ruined.'"

"There were 37 percent moremortgage defaults statewide in the first three months of this year compared to the same period last year. In Sacramento County, there were 1,140 defaults reported in the first quarter, 2006, and less than half as many, 738, last year at the same time."

posted by Ben Jones @ 2:15 PM