The #1 Reason Why Homes Are Being Foreclosed On?

...They Are Not Valued Correctly For A Short Sale.

1. Listing Prices Are Too High.
   Many homes are being foreclosed because the house did not generate any offers.  This causes either the listing to expire, get assigned to a new realtor, or the home being foreclosed because of the excessive days on market with no viable offers presented. The main reason for the listing price issue is the realtor may not understand how to value the property for a short sale, or the homeowner is holding out for as high a price as possible to pay off their mortgage balance - or a combination of the two.
   
   
2. Lender Appraisals Are Too High.
   The other problem is when the home gets an offers, but the lender does not approve the sale price.
   Each lender will order a BPO appraisal for a short sale. Many times though, the value comes in too high, and the investor that funds the mortgage to be released in the short sale, does not approve the sale price.
   
   What the lender, investor and anyone dealing with the pre-foreclosure market need to understand is what we call the Apex 10 Price.  In other words, what is the HIGHEST fair market value price for the home in "AS IS" condition, that it will sell for within 10 days. This is the true market value for the home.
   
   Why is this important?  Because the true appraisal value needs to reflect what someone is actually willing to pay for the home - period.  NOT what the realtor, homeowner, or lender THINK the home should be sold for, or what they HOPE it could be sold for.  What you think doesn't matter. What someone will write you a check for, or what a mortgage company appraisal for a new loan comes in at is ALL THAT MATTERS. 
   
   And, to protect the interests of the lender and investor, we suggest 10 Day Price to limit the legal and overhead costs to the investor.  We've seen lenders take FIVE MONTHS to approve a short sale that could have been closed  five months earlier.  This causes the investor to incur more expense especially for a mortgage that is in arrears.
   
   
3. The Deals Are Getting Lost.
   Because the Loss Mitigation Departments at the mortgage servicers are so overwhelmed with cases and understaffed to effectively work the cases, many short sale opportunities get lost, and the home gets foreclosed.
   Many lenders will require the buyers to be patient - and many buyers are patient - TO A POINT.
   Unfortunately, we are in a buyers market and there is a lot of inventory to pick from.  Buyers are not waiting forever without some indication on their purchase being accepted.