New Short Sale Laws for 2012

We wanted to call your attention to the strict short sale timelines that mortgage servicers will be held to under the terms of the state Attorneys General foreclosure settlement that was filed in federal court this week(March 12), and that we previously communicated to you in February. As reported on HousingWire.com, the new requirements for short sales include the following standards for the nation’s five largest mortgage servicers (Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo):

Mortgage servicers are required to give a decision to a borrower within 30 days of receiving a completed short sale request package.

The servicers’ internal groups must review all short sale requests in the first two months of the quarter, according to Exhibit E in the settlement filed this week.

And if a servicer takes longer than 30 days on more than 10% of the requests, the firm is considered in "potential violation."

The settlement also requires a servicer to notify a borrower within 30 days if any documents are missing from the request package.

Servicers will also be required to notify a borrower if there is a deficiency payment needed before the short sale is approved, including an approximate amount.

If more than 5% of all short sales approved in a given quarter did not include this disclosure, the bank would be in violation.

Documents pertaining to the Mortgage Servicing Settlement are available on the U.S. Department of Justice Web site as well as the National Mortgage Settlement Web site.

Living Southern Maryland Real Estate Blog is written weekly by me Southern Maryland Real Estate Agent Mike Ontiveros, a longtime southern Maryland resident. My blog is focused on providing the most up-to-date information on the Southern Maryland Area Real Estate market, from starter homes (condos, townhouses and detached homes) to luxury southern Maryland waterfront residences for sale and the current housing market. I welcome all comments and questions, so please feel free to ask us anything relating to Southern Maryland Real Estate or really anything about Southern Maryland. I hope you enjoy visiting my Southern Maryland Real Estate Blog and I hope to hear from you soon. Have a great day!
                    
T                                                                   Thanks for visiting
                                                             Living Southern Maryland Blog
                                                               Century 21 New Millennium
                                                                          (240) 538-1880
                                                                        by Mike Ontiveros