The REO Market has recently had changes in Hawaii due to Act 48 which was enacted in May of 2011. The Act stipulated that there be a moratorium on foreclosures and that the lenders had to meet with homeowners prior to foreclosing on their homes. If foreclosure went forward they would have to file a Judicial foreclosure which costs time and money for the lender.
We had inventory "shadow inventory" that the lenders are still able to process and sell as long as the Maui foreclosure happened prior to the new law's date. Currently there are 55 Residential Foreclosures showing active on Maui's MLS and 36 Condos compared to short sales at 68 for Residential and 62 for Condos.
Many owners knowing that the courts are tied up are waiting it out. Others who once tried to get a loan modification and were turned down are now trying again. Leverage is there now that the banks have to go through the Judicial foreclosure process.
I've represented over 75 Maui short sale owners and I am encouraging folks to modify if they can. If not short sale is an excellent option. The Judicial process may be slow but one bad potential outcome is that they lender asks for a deficiency judgement for the balance owed. In the non-judicial process lenders for the most part forgave the difference, but if they have to spend time and money they may not be as willing.
For further information please visit our website: www.FineIslandProperties.com or email me at Mauigina@gmail.com
I look forward to assisting you with your Maui Real Estate needs.
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