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Are Short Sales the Answer?
Are Short Sales the Answer?

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AIR DATE: July 27, 2012

The housing market is finally showing signs of life. Southern Nevada still tops the list of cities with houses under water but sales are picking up.  And increasingly, short sales and not foreclosures are driving those sales. So where is the Las Vegas housing market now? With a slight rise in home prices, are we actually seeing the end of bear market? What you should know about the new shape of the housing market and short sales.

GUESTS
Dennis Smith, President, Homebuilders' Research
Michele Johnson, Executive Director, Financial Guidance Center
Frank Nason, President, Residential Resources
Jay Brinkmann, Chief Economist, Mortgage Bankers' Association

 

LINKS
LV Sun: Sen. Dean Heller touts bill to speed up short sales

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    COMMENTS:
    I found Michele Johnson very condescending, arrogant, and highly offensive...she said homeowners felt "entitled" ?!?! your damn right as well we should be, if this were a real capitalist system the banks would have folded years ago, instead we have a Socialist system, where taxpayers bailed out failed banks, so they could turn around and take our homes? Listen up Ladies and Gentlemen, the banks have made a crime scene of the Recorders Offices all over the country, they are stealing from you daily via LIBOR manipulation, and I can comfortably say that 75% of loans have fraudulent,insufficient, or missing vital documents...If your Note was ever split from the Deed, the banks have a huge problem to solve, they are counting on your ignorance...don't listen to these people they are bank bias, and the banks only desire is to rob you of your home. Do not short sale, fight them every step of the way, I stayed in my home for 3 years without a mortgage payment before they were able to get me out, the more people who stand up for their rights will force these judges to take notice...demand to be heard. The Gentlemen guest was right "...the banks are insolvent"
    Jennifer FlorioJul 27, 2012 00:25:22 AM
    To clarify, it was said on the show this am that if a short sale is not completed by 31 Dec 2012, we will be held responsible for tax consequences? The mortgage company will send docs to IRS for payment? Our home has been on market since Feb 2012, had one offer accepted by all. BoA appraised it higher than offer and turned down. Now we wait. If short sale expires, does it automatically get foreclosed?
    m liebenJul 26, 2012 09:59:36 AM
    We are underwater on our mortgage but able to make our payments. We don't want to move, we just want to refinance to take advantage of the low interest rates but we are not a fanny mae/or freddie mac mortgage. What can we do???? HELP
    CarolJul 26, 2012 09:57:38 AM
    I completed a short sale with a great realtor & an inexpensive real estate attorney last december. It took 8 months from listing to signing off on the property. If the bank had been willing to work with me, i could have stayed in my home. I take exception some of the comments by ms. johnson, they sound very judgmental to me. what is really sad in this market: people who need to buy affordable homes cannot do so, and there is no mechanism in place to keep las vegas from becoming this investors' haven, just as it was when the boom was starting in the late '90s. Get a good attorney. My realtor was not prepared to deal with the complications of my short sale, but what he did do was keep the buyers hooked on the sale during the long process of dealing with creditors. I regret ever buying in this market.
    Teresa ManixJul 26, 2012 09:55:17 AM
    It is immoral for the banks/investors not to refinance underwater housing for their current market value. Both banks/investors have been compensated handsomely from our government and the difference has already been paid in the financial markets. Only the home owner had not been compensated. Home owners have been made the scapegoats. Something else needs to be done. Perhaps the idea of what San Bernadino, CA is doing. This idea is where the city buys the note for current value then refinances the home to the homeowner for 95% of the value. Remember these notes have already been compensated, by the government, the difference of the notes value.
    DougJul 26, 2012 09:50:30 AM
    We are prequalified for about $170,000 and check new Las Vegas real estate listings everyday. We make an retail or over offer on viable properties right away and find it impossible to buy a 1st owner occupant property. They seller will just sit on the property until a cash investor comes along. For the FHA buyer it seems impossible to even find a property. Sometimes the listing will even show that has a contingent cash offer as it's first listed for sale.
    Jeff GustafssonJul 26, 2012 09:36:49 AM
    The *only* way to deflate a price bubble is to let prices return to their true, pre-bubble level. During that process, some investors and homeowners will necessarily take a financial loss, perhaps large ones; morally, this loss should *not* be borne by other taxpayers who did not foolishly risk their money on such boondoggles. Continually bailing out banks and individual homeowners, as the government is doing, will simply delay the day of reckoning and increase the severity of the eventual correction. These are economic laws as unavoidable as any law of nature, so don't hold your breath waiting for housing prices to rise any time soon.
    Tom HurstJul 25, 2012 14:04:07 PM
    You're blaming the victims, if you are aiming this barb at everyone who bought a house at that time. I bought a house to give a home to my child a couple of years after a divorce, so I wouldn't live in some crappy apartment or have to move every couple of years. (We had a wonderful home as a family. I couldn't begin to buy something comparable, but after losing a nice home I don't think your child should have to live in a really terrible home, either. And the home we live in is okay to me, but a lot of people wouldn't think so and wouldn't live in this part of town.) This destroyed me financially. I was not trying to make a killing off of the house. It was not a second-home investment. I am not stupid, either. On the contrary. How does it hurt you, Mr. Hurst, if Bank of America were forced to reduce my principal to what it would have been had the house had a fair price in 2004? It's so easy to pass judgment on people, isn't it?
    destroyed by Wall StJul 26, 2012 09:52:20 AM
    Articles like this which imply this is the end of the bear market are very shallow. You need to research what is really happening. Since the state legislature passed AB 284 making it difficult for banks to foreclose, the number of foreclosures has dropped to a trickle. Those homes are still out there. How long are the banks going to tolerate this huge inventory of non-performing assets. Sooner or later these homes will be foreclosed and what is that going to do to the market?
    Trish RippieJul 25, 2012 12:50:54 PM
    Trish: Many thanks for your comments. We certainly did not mean to imply that the bear market has ended. If anything, we think that talk of a few months' price rises is a very limited trend and we want to find out where experts think the market really is. But short sales are up in the Las Vegas market, so they're bcoming a path forward for a growing number of underwater homeowners. We will certainly be discussing the impact of AB 284 in slowing foreclosures and pushing both banks and owners to make short sales. Please tune in.

    ~KNPR's State of Nevada

    Ian MylchreestJul 25, 2012 14:10:38 PM
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