Last year at this time about 10% of our Short Sale clients were getting money at closing from their bank for relocation assistance. Now it’s about 28% and if it continues to increase at this rate it looks like it could be 50% of our short sales by the end of the year.
What is Short Sale Relocation Assistance?
All major servicers are now offering cash to homeowners to do a short sale through the HAFA (Home Affordable Foreclosure Alternative) program rather than allow their homes to go into foreclosure. It’s nice to see that the banks have finally woken up and realized that short sales are far better for them than foreclosures. Last month we compiled data from MLS and found that short sale homes sold for 24% more than foreclosed homes in Massachusetts in 2011. That substantially decreases the loss for banks. This is why many of them are now paying incentives for distressed homeowners to do a short sale.Do You Qualify?
How Much Are Short Sale Sellers Getting?
Some major banks such as Bank of America, Chase, and Citi are paying their own incentives on their own loans. Last year Chase began offering the largest short sale incentive which can be as much as $45,000. In October of 2011 we were able to obtain our first large Chase Bank short sale incentive for one of our clients. Since that time we have done a few more and many smaller ones. So far this year the average cash incentive for our short sale clients is $3,010.
For homeowners who can no longer afford their homes, the HAFA Program has become very successful and we have been able to get over 100 of our clients into it. HAFA is short sale program under HAMP (Home Affordable Modification Program) that offers $3,000 in relocation assistance. In addition to compensation for moving expenses, homeowners do not have to pay the mortgage deficiency after the property is sold.
Bank of America has also made some very positive changes to its co-op program which offers $2,500 in relocation assistance and a very streamlined short sales process where very few financial documents are needed to prove the hardship.
In all we have negotiated over $150,000 in relocation assistance for our short sale clients in the past 12 months.Do You Qualify?