Maria Said

Posts Tagged ‘foreclosure’

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.