If you have been through the fun of buying or selling a property which is upside down, ie. more is owed than the property is worth, you know how much fun this can be. For those of you who have not had the privilege, it is a 90 to 120 day process involving numerous lender phone calls, and lots of paperwork.
Recently, Fannie May started a pilot program in which they set a pre-approved price that is acceptable, so the negotiation time is minimized, at least in theory. Currently they are working only with Countrywide, and only about 400 homes in the valley are eligible. If the program goes well, expect more lenders to get on board.
It will be interesting to see what happens with pricing! My expectation is that initially, fewer short sales and more foreclosures will occur, because the pre-approved prices will be optimistic. We’ll see.
For more info on this, see the original article.
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