Bank of America and GMAC are beginning to start the process of foreclosure on the millions of home owners who are delinquent 90 days or more on their mortgage. However, homeowners who are being affected by the foreclosure process are wondering why their banks don't help them get either a loan modification first and then try to short sale their home. Arizona has multiple homeowners who are trying to short sale their home in hopes to stay clear of the foreclosure process. However, borrowers and real estate agents are finding this difficult due to the guidelines with the banks. Another reason that banks are not approving short sales so quickly is due to fraud, tax liens, difficulty in locating the correct borrower, and not sending in the correct documents that are requested from the lender.
The Short Sale process is a difficult producer that requires a lot of components. It is recommended that a borrower apply for a Loan modification prior to applying for a Short Sale. Short Sales and Foreclosure affects the customer credit in a negative way. The difference is that a Short Sale has a negative impact on your credit for 3 to 5 years, and a foreclosure is 7 years after the foreclosure. Banks prefer foreclosures because they are able to make more money than a short sale.
