Volume of Short Sales Triple Since 2008

The Los Angeles Times chased down a report released last week by Core Logic that projects short sales will mushroom in 2010. It says short sales have tripled in the Sunbelt over the past several years. A short sale happens when the bank accepts a payoff for less than the amount owed.

Until we actually embark on the road to recovery, which seems to be a long way off in the future, I predict short sales will continue to rise. The question isn't whether a seller wants to unload an underwater home, the question is when. Sellers are finding out that loan mods aren't working and appreciation can't be found lurking anywhere on the horizon. Government programs aren't making the huge impact they were touted to make, and nothing is getting any better.

Last week, Wells Fargo foreclosed on a condo in Sacramento it had been considering for a short sale. No warning, just foreclosed. We had brought the bank an all-cash offer for $100,000, which was how much the last condo sold for. Wells Fargo insisted on $115,000. The buyer agreed to $115,000. Then, Wells Fargo then said it wanted $125,000 and foreclosed. It walked away from the trustee's sale at $96,000. Obviously, not every bank will agree to a short sale even if it says it will. These are strange times we're in.

More Articles by Elizabeth Weintraub:

• Choosing a Loan Mod Over a Short Sale
  
• Not Every Short Sale is a Bargain
  
• Putting Your Hardship Into Words

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_{At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.}