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Banks See Spike in Short Sales

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  • Description

    FBN's Liz MacDonald on the major paradigm shift in housing.

  • Duration 1:50
  • Date

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Well it is being called late.

Major paradigm shift in housing big banks are not taken a new approach underwater mortgages.

Could this -- the housing rescue that everyone's been waiting for Liz MacDonald is here with -- -- bottom line so what exactly.

-- they have up their -- -- what they're doing now is scared now allowing.

Borrowers basically to sell and basically have the bank forgive their loan right up in the beginning it's called the short sales -- also known as -- pre foreclosure sales and -- JPMorgan Chase is doing at Bank of America is doing it.

And basically other banks are tacking -- like Wells Fargo and what we're seeing is this is a big ship because ordinarily the banks saying wait a second we don't want to forgive loans up -- we don't wanna do this -- -- -- trigger strategic defaults now they're saying.

Look at for closer process is too scary too many DC regulators piling in.

-- -- you seeing banks short sales at a 25%.

A year is up 25% vs a year earlier that's a three year high and you're seeing the prices a housing prices coming down and short sales.

27 year highs this year -- rather -- -- so long was it because of the mortgage Solomon and the year all the lawsuits all the attorney generals across the country yeah asset -- so long but -- -- taken off in places like New York Colorado New Jersey and Florida got to tell -- something -- the foreclosure process is really difficult for banks so they are weighing in the -- this thing you know what we're -- is gonna forgive these loans upfront forgive a portion and to -- -- -- numbers -- striking -- sixteen.

Million -- under water.

Loans they've got four million.

The foreclosures in the pipeline delinquencies so the banks are saying you know what we got a -- different strategy here and this could turn things around.

-- McDonald adjusting report and kind of scary but -- ego and yeah.

Goodness -- -- --

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