What should I do with this property? This is a pressing issue in today’s real estate environment in many circumstances. Owners and agents alike are posing this question every day.
The market has begun its journey toward recovery and home prices are rebounding. The recovery has made it possible for an increasing number of previously underwater sellers to become equity sellers again. While the recovery is in PROCESS, there are many agents and sellers that remain frustrated with the rate of PROGRESS.
For many this will be a slow and long process. While there are sellers who absolutely must sell their current home to complete their next purchases, there are many sellers and investors that are looking to capture that golden moment and they are contemplating whether to sell now or rent. When renting the property today, the sellers allow the recovery of the market to expand, thus creating the potential for additional equity to build.
Many sellers opt to offer their property for sale in hopes that the limited inventory of available listings will lead to a possible bidding war and an increased sales price. This bidding war speculation is further fueled by the recent modifications imposed by Fannie Mae. Recently, there was a reduction in the required recovery period for buyers that have experienced financial difficulties in the past.
The new requirements are listed below:
|Financial Experience||Required Recovery Period:|
|Chapter 7 Bankruptcy||4 Years from Bankruptcy discharge date|
|Chapter 13 Bankruptcy||2 Years from Bankruptcy discharge date|
|Short Sale/Deed-In-Lieu||4 Years from Deed date (2 Years with 20% down)|
|Foreclosure in Bankruptcy||4 Years from Bankruptcy discharge date|
|Foreclosure NOT in Bankruptcy||7 Years from Deed date|
With many of the required financial recovery periods reduced by nearly 40%, there will be more buyers looking to get back into the home buying process sooner than previously anticipated, thus creating its own buying frenzy.
While selling or renting is an individual decision, each opportunity should be carefully strategized to allow the market to yield the maximum benefits to the sellers and landlords.
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