Why Short Sales and Foreclosures but not Principal Reduction Loan Modifications?
January 6th, 2010
I think it’s obvious that TARP recipients and HAMP participants have not done what was expected to keep homeowners in their homes. In fact, I believe that it has been the banks/lenders willingness to foreclose and accept short sales rather than do principal reduction loan modifications that has caused Florida, Arizona, Nevada and California home values to drop significantly. If a lender is willing to take a 50% bad debt loss via foreclosure or short sale, why not reduce the principal so the homeowner can stay in his home? It’s the same loss but involves no sale of property, no decline in market value and no decline in the property tax base. As an added bonus, homeowners and their families aren’t forced to move! I’ve talked with a CPA and he has confirmed that a bad debt loss is just that – regardless if the bad comes from a short sale, foreclosure or loan modification.
Related posts:
Posted in Loan Modification | 
Tags: foreclosure, Loan Modification, principal reduction, short sales
Thank you. Really informative entry.
Greetings and thank you for a informative posting. I appreciate what you posted.
I found your blog because I wanted more information. The content you have on your blog needs to be discovered so I have added you to my Google News Reader. I really look forward to reading more posts from you.
I am so happy I found your blog. The information on your blog needs to be discovered so I have added you to my Google News Reader. I really look forward to reading more posts from you. Keep up the good work!
Thank you for the information. I have been trying to avoid foreclosure and this helps me greatly to put things in perspective
I am happy to have found your site. The information is right on and groovy. Keep up the good work and I will keep coming back to visit.