Homeowners distressed by the housing sector meltdown in the Southern Oregon real estate market can look forward to help from the U.S. Treasury Department in the upcoming months. Last week the Treasury Department unveiled new rules for homeowners nationwide who need to sell but are “underwater” and unable to get a price for their home that would cover the amount owed to their lender. The Treasury Department plan has been created to help those who either don’t have enough income or whose debt levels are too high to allow them to qualify for a loan modification under the multi-billion dollar program known as Making Home Affordable.

When a home in the Southern Oregon real estate market is listed for a price below what is owed to the lender, it falls into the category of a Short Sale, but make no mistakes about it, there is nothing short about it, except for the funds necessary to pay off the loan. However, there are advantages to a short sale; in addition to saving the seller’s credit, short sales save the banks the expense of foreclosure. Short sales also help to solidify neighborhood property valuations because a short sale price is most likely a higher price than what the house will sell for through foreclosure. It is estimated that in 2009, one out of every ten home sales was a short sale, and in some distressed areas like Las Vegas and Sacrament, the ratio is much higher.

Following are the guidelines for qualification for the new Treasury Department assistance:

• The property must be the principle residence of the applicant.

• The homeowner is either currently engaged or about to be engaged in foreclosure proceedings.

• The loan is less that $729,750 and was initiated before January 1st of 2009.

• The applicants’ monthly mortgage payment is greater than 31% of their before-tax income.

There will be more to come on my blog regarding this program and others that may help the Southern Oregon real estate market recovery.

Michael Masters

A Socially Conscious Real Estate Consultant

     

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This entry was posted on Thursday, December 10th, 2009 at 9:00 am and is filed under the category Grants Pass Real Estate, Green Real Estate, Michael Masters, Real Estate, Southern Oregon Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.