Short Sales Rising Sharply

Whether it is just battle fatigue or simply good business sense, homeowners are looking at short sales, getting cash for keys and trying to get relocation fees to move. The banks are loosening up their standards for short-sales because failure to do so clearly reveals their malevolent intent to steal homes that they could not otherwise get if the judicial system starts operating properly.

That more and more judges are starting to scrutinize the documents and the actual transfer of money from one party to another, it is becoming increasingly apparent that the documents are for a transaction that is non-existent and that the loan is not supported by any documents — because the loan came from a third party with no connection to the loan originator.

Then comes the horrific problem with title which at some point will need to be addressed much as Florida did with the Murphy Act. Title must be reset because at this point there is practically no such thing as clear title as result of the work done by Wall Street.

The title problem can easily be minimized with a signature from the homeowner which is what is required in a short-sale, as opposed to a robo-signature from an unauthroized person signing a deed for the bank in an REO sale.

The last problem is that at the end of this year forgiveness of debt becomes taxable, which is bad for short sales after December 31, 2012. So the rush is on to get them done — but that is probably premature because the law will probably be extended by the lame duck congress after the elections. Everybody seems to want the extension.

See congress working on extension of tax exemption at Rain City Guide Blog by Craig

Tags: debt forgiveness, short-sale, tax, title
Posted in bubble, Corruption, Eviction, securities fraud |