GLOZAL - A Social Real Estate Network

Banks Offer More Cash Incentives for Short Sales

 

More banks are offering home owners incentives to sell their houses in a short sale to prevent a costly foreclosure to the bank. In fact, some banks are offering struggling home owners as much as $35,000 to do a short sale, according to an article at CNNMoney.

Many home owners have been surprised at banks’ recent willingness to approve short sales.

"Initially, the home owners are skeptical," says Elizabeth Weintraub, a real estate professional in Sacramento, Calif. "The bank may have already turned down their request for a modification. Then, one day, they call and say, 'Let us give you some cash.'"

For banks, the incentives have proven to be a smarter move than letting a property fall into foreclosure.

"The first choice is a modification, but if that's impossible then a short sale is a faster, more efficient solution," Tom Kelly, a spokesman for Chase Mortgage, said. 

With a foreclosure, home owners stop making their mortgage payments and usually property taxes as well. They also often put off maintenance issues, which can cause the home to lose value even more. Foreclosed homes sold, on average, for 22 percent less than homes not in foreclosure in December, according to National Association of REALTORS®’ data. For comparison, discounts for short sales were about 14 percent.

"I've seen a lot of foreclosures for sale where it would cost a lot more than $20,000 to get them into condition to sell again," says John Hayton, a short sale specialist in Orlando, Fla.

 

 

 

 

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Comment by Chuks Odikpo on February 14, 2012 at 11:35am

Is Chase the only Bank giving this incentives? Why are more Banks not doing this?

Comment by Tatiana Varon on February 14, 2012 at 10:54am

Chase are offering $10.000 to investor owners at closing. I recently closed two deasl and both get that amount in moving expenses.   Chase  are offering to Primary owner $20K in relocation

Comment by Tom Turner on February 14, 2012 at 10:50am

I closed one with Chase a couple months ago, where they paid all of the closing cost on a $78k deal and my client got $15,000 at the closing table. Great for that "ONE" seller, but why don't they give them  maybe $5000 and use that other 10k to help cover losses on some of the other ones so we can close more. It doesn't make much sense to give that much to one person, while 5 other deals go south because they are not going to new enough.

Comment by Lillianne Echevarria, ABR, e-PRO on February 14, 2012 at 10:42am

I guess the numbers are going up. One of my clients received a $1K moving incentive two years ago.

Comment by Michael J. Zwirn on February 14, 2012 at 10:38am

Totally old news in California, at least for CHASE loans. This was known very early in 2011. I recently closed a deal where my client not only received $25,000, but $3,000 in moving exoenses as well.

Comment by Gertrud Borchardt on February 14, 2012 at 10:36am
Smart move!

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