Proposed Bill to Speed Up Short Sale Process and Prevent Foreclosure

02/20/2012BY: ESTHER CHO

To avoid losing homes to foreclosure due to long response times for short sale transactions, three senators introduced legislation to speed up the short sale process.

Senators Lisa Murkowski (R-Alaska), Scott Brown (R-Massachusetts), and Sherrod Brown (D-Ohio) proposed the bill addressing the issue of short sales timelines on February 17. A short sale is a real estate transaction where the homeowner sells the property for less than the unpaid balance with the lender’s approval.

“There are neighborhoods across the country full of empty homes and underwater owners that have legitimate offers, but unresponsive banks,” said Murkowski. “What we have here is a failure to communicate. Why don’t we make it easier for Americans trying to participate in the housing market, regardless of whether the answer is ‘yes,’ ‘no’ or ‘maybe?’”

The legislation, also known as the Prompt Notification of Short Sale Act, will require a written response from a lender no later than 75 days after receipt of the written request from the buyer.

The lender’s response to the buyer must specify acceptance, rejection, a counter offer, need for extension, and an estimation for when a decision will be reached. The servicer

will be limited to one extension of no more than 21 days.

The bill will also allow the buyer to be awarded $1000, plus “reasonable” attorney fees if the Act is violated.

According to a release from Short Sale New England, short sale homes do not bring down neighboring home values like foreclosed homes do, and 83 percent of short sale buyers are satisfied with their purchase, according to a 2012 Home Ownership Satisfaction Survey conducted by HomeGain.

“The current short sale process can be time consuming and inefficient, and many would-be buyers end up walking away from a sale that could have saved a homeowner from foreclosure,” said Moe Veissi, president of the National Association of Realtors. “As the leading advocate for homeownership, realtors are supportive of any effort to improve the process for approving short sales.”

Equi-Trax released a survey last year on the issues real estate agents face when completing short sales. Guy Taylor, CEO at Equi-Trax, said 71.9 percent of respondents reported that a short sale can take four to nine months to complete, and they think that is simply too long.”

The survey also found that 18.2 percent of deals require less than three months to complete, with 10 percent requiring more than 10 months.

When agents in the survey were asked to how the short sale process can be improved, 57.6 percent said lenders should take less time to close transactions, 14 percent said borrowers should be better educated about short sales, and 40.4 percent said both of these changes are necessary to improve the process.

In April 2011, a similar bill was introduced by Reps. Tom Rooney (R-Florida) and Robert Andrews (D-New Jersey), but this version requested a response deadline of 45 days instead of 75 from lenders. The legislation never came up for debate before a House committee.

10 Great Places to Retire in the U.S.

Your retirement planning may include visions of a home close to the beach, mountains or a lake. Or maybe you're hoping for a Main Street kind of place, a walkable community or a budget-friendly locale.

Bankrate researched median home prices in some of the United States' top retirement spots, as outlined in "America's 100 Best Places to Retire," edited by Elizabeth Armstrong.

Median home prices in the 10 places Bankrate selected from the book's "top" lists range from $125,000 in Danville, Ky., to $639,500 in Carlsbad, Calif., with many homes priced in the high $100,000s to the low $200,000s.

Here's what you can expect from among the best places to retire in the U.S.:

Danville, Ky.

Price: $125,000

Area median price: $125,000

Features

• 3 bedrooms, 2 baths
• 1,456 square feet
• One-car detached garage
• Covered deck, open patio

This three-bedroom, two-bath ranch house built in 1950 has 1,456 square feet and is situated on a lot just more than four-tenths of an acre. The home is typical of what buyers can expect in Danville at the median price range, though for the same money, home shoppers can find three- and four-bedroom homes ranging from 1,300 square feet to 2,320 square feet.

Retirees buying in Danville typically are able to spend more -- in the low $200,000s, says Benjamin Guerrant, principal broker with Prudential Guerrant Real Estate.

Danville earned a spot among the "top 10 budget towns" with some of the lowest utility costs in the nation, Guerrant says. But the lifestyle here isn't just for the frugalati. Danville is home to Centre College, and its performing arts center brings in shows that rival what you'd see in Lexington, Louisville or Cincinnati, Guerrant says. "I've seen Mikhail Baryshnikov, Dolly Parton and 'The Wizard of Oz,'" he says. "It's a tremendous draw for talent."

Danville also ranked as a "top 10 Main Street town," thanks to a well-planned downtown with four lanes and parking on both sides of the street, Guerrant says. "That has been very crucial to the success of businesses downtown," he says. What's more Main Street than a band? The Great American Brass Band Festival is held in Danville every June.

Danville is the kind of place where people stay and often work in the family business, says Guerrant, who is the fourth generation in the family real estate business. The town's funeral home has provided income for at least three generations, and the town bakery is into the fifth generation, he says.

Annapolis, Md.

Price: $350,000

Area median price: $396,330

Features

• 2 bedrooms, 1.5 baths
• 1,524 square feet
• Close to downtown Annapolis

For $350,000, you could get this two-story Cape Cod built in 1967 with a timeless floor plan. The home includes 1,524 square feet, two bedrooms, 1.5 baths, a sunroom, a fireplace and a basement, all on a one-fifth acre lot. This house was originally listed near the area's median price, at $387,900, says listing agent Maria Smith of Long and Foster Real Estate.

"You're in walking distance of the U.S. Naval Academy stadium, food shopping, banking, doctors, restaurants -- all within a mile," Smith says. "You can walk to the harbor and watch boats come in and out. Annapolis is a small town, just like the ones many people grew up in."

Annapolis was rated one of America's "top 10 four-season towns," but great living here is not so much about the weather as the location and lifestyle that go with it. What really draws people are neighborhoods within walking distance of downtown Annapolis, the U.S. Naval Academy and Annapolis Harbor.

In this price range, homeowners are typically looking for a two- to three-bedroom home with at least a bath and a half and a good-size yard, says Realtor Judy Lemmons of Long and Foster Real Estate.

Woodstock, Vt.

Price: $375,000

Area median price: $375,000

Features

• 6 bedrooms, 3 baths
• 3,580 square feet
• Built in 1850, partially renovated
• Fronts on a brook
• Detached garage/barn

This antique six-bedroom, three-bath home on just under one-quarter acre has been partially renovated to incorporate modern infrastructure and function. It sold for the median price of $375,000. It's an easy walk to the village center, says broker Robert Wallace of Robert Wallace Real Estate.

Woodstock, distinctive as a "top 10 undiscovered" and "top 10 small town," is set in the foothills of the Green Mountains. The town population is a mix of year-round and part-time residents, with people from many walks of life with diverse experiences, Wallace says.

The town has a legacy of historic preservation, many antique homes and a protected historic district. "The community is centered around a central village core with a fine assortment of shopping, restaurants and services that are very uncommon for a small village setting," Wallace says. "Woodstock offers a pleasant mix of a relaxed pace combined with the availability of recreational and cultural amenities."

Asheville, N.C.

Price: $199,900

Area median price: $192,500

Features

• 3 bedrooms, 1 bath
• 1,515 square feet
• Fireplace
• Two acres
• Covered front porch, rear deck

In the North Carolina mountain town of Asheville, this 1,515-square-foot, three-bedroom, one-bath house with hardwood floors, wood fireplace, covered front porch, rear deck, all on about 2 acres, sold for $199,900. That's just a bit over the area's median price of $192,500, says broker Jason Brodsky of Asheville Holistic Realty at Keller Williams.

Asheville, on two lists for "top 10 mountain towns" and "top 10 college towns," has a very high quality of life to cost-of-living ratio, Brodsky says.

Asheville offers amazing diversity and natural beauty," he says. "There is an abundance of culture, from traditional Appalachian crafts and music to world-class dining and entertainment." Asheville is home to the award-winning Mission Hospital. As for higher education, the city offers UNC-Asheville and Warren Wilson College, both recognized by Princeton Review and The New York Times as superior schools, Brodsky says.

Saugatuck-Douglas, Mich.

Price: $207,000

Area median price: $204,000

Features

• 2 bedrooms, 1 bath
• 1,003 square feet
• Deck
• Small pond, waterfall
• Oversized garage with loft

This two-bedroom, one-bath, 1,003-square-foot home with a pond and waterfall sits on just under one-fifth of an acre and is within walking distance of downtown Douglas, says broker Sandy Jo Shanahan of Shoreline Realtors. The garage has a loft perfect for a home office or studio.

Saugatuck-Douglas is marketed as a perfect getaway destination for a weekend or a season, but some people put down roots here. Named a "top 10 lake town" and "top 10 small town," the resort community boasts 19th century architecture, rolling dunes and lush orchards, as well as lakeshore activities and art galleries galore. In fact, it's often called the "art coast of Michigan."

"The best part about living here is that you are living in a community that others take their vacations to," Shanahan says. "You never have to go home -- you are. It's life as it should be lived."

Athens, Ga.

Price: $139,900

Area median price: $137,000

Features

• 3 bedrooms, 2 baths
• 1,360 square feet
• Fireplace
• Attached two-car garage

For $139,900 in east Athens, you could buy this three-bedroom, two-bath, 1,360-square-foot ranch house on a nearly two-thirds acre lot, built in 1998 with custom cabinetry, a fireplace and attached garage.

In Athens, one of the "top 10 Main Street towns," people enjoy the downtown area with its walkable communities and outdoor restaurants, 100-year-old homes, music, boutiques and art galleries, says Bruce Azevedo, owner and broker of Re/Max Top Performers in nearby Watkinsville.

Downtown Athens, within walking distance of the University of Georgia, also earned a spot on the "top 10 best college town" list. People enjoy the continuing education classes and cheering on the Georgia Bulldogs, says Realtor Pauline Juul of Prudential Blanton Properties. "In addition, there are two great hospitals, several parks and great shopping," she says. Athens is an easy drive to Atlanta and the mountains.

But living in walking distance of downtown and the University of Georgia will cost you more, with prices up to $600,000, Azevedo says. "If you want to feel like you're on the Riviera, I can put you downtown among the cafes with awnings and you're eating outside all day," Azevedo says. "They block the streets for bike races and music festivals. There's something for everyone."

Carlsbad, Calif.

Price: $639,900

Area median price: $672,500

Features

• 3 bedrooms, 2.5 baths
• 2,352 square feet
• Granite countertops
• Attached garage
• Lagoon water views

For $639,900, you could get this three-bedroom, 2.5 baths 2,352-square-foot townhome, with granite counters, a security system, Bose speakers and attached garage. On a lagoon, the home affords a water view from most rooms, and it's in a community with walking trails near a beach.

Homes at the median price in Carlsbad are typically larger and more expensive than retirees are looking for, says broker Tony Cannon of Keller Williams Realty. For substantially less -- $374,000 -- you could get a home more suitable for empty nesters: a two-bedroom, two-bath, 1,100-square-foot home with a patio, garage and a low-maintenance yard in a community with a pool and spa, on about one-eighth of an acre, Cannon says.

The weather and the beach are the main draws for retirees in Carlsbad, which ranks among the "top 10 beach towns."

"East Coast people come out here because the weather is nicer," Cannon says. "It's mild all year long. We get people from Canada, other parts of California, even Arizona and New Mexico. If you live within 5 miles of the beach, you don't need air conditioning."

Naples, Fla.

Price: $175,000

Area median price: $175,000

Features

• 4 bedrooms, 2 baths
• 2,272 square feet
• Double garage
• 2.3 acre lot
• Cathedral ceiling
• Large kitchen island

In Naples, the median price of $175,000 could get you into this contemporary four-bedroom, two-bath, 2,272-square-foot home built in 2002 on 2.3 acres, says Mark Weber, broker and owner of White Sands Realty in Naples.

Don't count on an easy walk to the beach or Old Naples at the median price. This home and others in the same price range are likely to be 30 or 40 minutes from the beach, Weber says. "A home in a great location about eight minutes from the beach goes for around $375,000 (used to be $840,000 in 2006). An older condo right on the sand with a Gulf of Mexico view goes for around $700,000 (formerly more than $1 million in 2006).

Ranked as both a "top 10 beach town" and a "top 10 art town," Naples' home prices vary, depending on proximity to the beach. High-end homes are going for about half of what they did in 2006, says Weber.

"Naples is very appealing to second-home buyers and northerners," Weber says. "We have extremely low crime to the point that many native Neapolitans still leave their doors unlocked when they take a walk. The palm-lined streets of Old Naples are home to outdoor cafes, boutique shopping and some of the most beautiful white sand beaches in the world."

Bend, Ore.

Price: $207,000

Area median price: $204,000

Features

• 3 bedrooms, 2 baths
• 1,997 square feet
• Two-car garage

For $207,000, you could buy this: a three-bedroom, two-bath, 1,997-square-foot home built in 2000, says Eileen Dees, principal broker of Steve Scott Realtors. This single-level mountain-view home includes an attached two-car garage, formal living room, family room, a patio, and a one-fifth acre lot with room to park an RV.

Bend ranks among both the "top 10 four-season towns" and "top 10 mountain towns."

Active retirees in Bend enjoy downhill skiing at Mt. Bachelor, cross-country skiing, snowboarding, an antique car club and more, Dees says. Those who want to give back to the community can find the right volunteer opportunity through VolunteerConnect.com.

"Bend is a great family town and a wonderful place to retire," Dees says. "I have two friends who are in their late 60s who snowboard. We also have incredible nonprofit groups to get involved with. I've lived in Bend for 19 years and still love it."

Coeur d'Alene, Idaho

Price: $179,900

Area median price: $180,255

Features

• 3 bedrooms, 2 baths
• 1,380 square feet
• Rock fireplace
• Two-car garage

This home is typical for listings near the median price, says Kim Cooper, broker at Select Brokers in Coeur d'Alene. The 1,380-square-foot, three-bedroom, two-bath ranch house was built in 1999 and has vaulted ceilings, a rock fireplace, open floor plan, patio, storage shed and two-car garage on a one-fifth acre lot.

In Coeur d'Alene, named a "top 10 lake town," the namesake lake has helped build the town's reputation. Along with water activities and beach, locals here enjoy wineries, art galleries, community theater and a casino.

"Coeur d'Alene is a place of four distinct seasons," Cooper says. "Each brings its own treasure trove of activities. With our multitude of lakes and rivers, hundreds of miles of trails and thousands of acres of national forest surrounding us, the opportunities for outdoor activities are endless. We enjoy the beauty of forested mountains by hiking or riding the trails. Yet, we are within 25 minutes of minor league baseball, hockey and Championship Arena football in Spokane, Wash., where we can also enjoy Broadway productions, symphony and a thriving art district."

As always in real estate, location is key. In the pricier towns, you can often move just a few blocks away from the trendiest, most desirable neighborhoods and save tens or even hundreds of thousands of dollars, which helps immensely when you do your retirement planning.

A location near the grandchildren often trumps all other considerations.

Article Courtesy of Karen Haywood Queen
Saturday, October 16, 2010

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