New law proposed to shorten the short sale process

On September 15, 2010 a bill was filed by U.S. representatives Robert Andrews (D-N.J.) and Tom Rooney (R-Fla.) to speed up short sales. This bill is H.R. 6133, “Prompt Decision for Qualification of Short Sale Act of 2010” and is supported by the National Association of Realtors (NAR).

“The short sale, which requires lender approval, is an important instrument for homeowners who owe more than their home is worth,” said NAR President Vicki Cox Golder in a news release. “While the lending community has worked to improve the size and training of their short sales staffs, they still have a long way to go on improving response times.”

According to NAR, in the second quarter of this year Nevada had 32% of all properties on the market said to be a short sale, with California 28%, Florida 27%, and Arizona 24%.

Forcing lenders to make a prompt decision on short sales would help buyers and sellers alike, and would help a great many people who are underwater on their homes and unable to sell as a result. Currently 25 percent of borrowers with mortgages are underwater, and further declines could cause even more homeowners into negative equity.

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