Foreclosures and Bank Meetings
Oct 12, 2010
REALTORS need to understand each lenders policies for underwriting loans, valuing property, selecting brokers for REO listings, and deciding whether to approve a short sale.
Having a single point of contact is extremely important to improve service to the borrower, short seller, and the real estate agent. NAR is urging all lenders to adopt this approach.
FHA and the government sponsored enterprises (GSEs: Fannie Mae and Freddie Mac) have become over-focused on safety at the expense of their mission. NAR urges lenders to advocate a return to a reasonable center, now that credit policies have over-corrected.
When a borrower applies for a loan and receives a conditional approval, the conditions are often impossible to meet. It would be better to decline the loan and allow all parties to move on. Short sale approvals often take months. HAFA and other short sales programs should be implemented quickly.
Lenders are aware that problems related to the application of new appraisal guidelines have skewed some appraisals. NAR continues to raise these issues with the lenders, regulators, FHA, and the GSEs and seek solutions.
Real estate professionals work extremely hard and for many months on a successful short sale. NAR urges lenders to make commissions policies more transparent and to agree not to reduce commissions at or shortly before closing. At the same time, NAR acknowledges that lenders waste time processing short sales that are not real offers, and we urge our members not to participate in this practice.
Lenders also are monitoring performance of REO listing brokers and will take steps to resolve problems.