A New Program Offered for Short Sale Incentives to Homeowners and Lenders

May 14, 2010
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New Program to Offer Short Sale Incentives to Homeowners and Lenders

Programs have been intended to stem foreclosures through encouraging loan modifications and motivate demand for housing with tax credits.

Currently, the administration is taking a slightly different tack. The New York Times reported a new program that will pay both homeowners and banks in an effort to motivate short sales.

Homeowners who are delinquent on their mortgages appear to be the program’s target. They would receive $1,500 in “relocation assistance,” most probably when their home is sold. The bank that services their mortgage would receive $1,000 for the first mortgage and another $1,000 if there is a second mortgage.

It is reported that the program will start on the 5th of April.

According to HousingWire, this program seems to be the “Home Affordable Modification Program (HAMP)”, which was announced late last year. Whether the name and details will remain is yet to be seen — the Treasury Department that will run the program but does not seem to have any information up on their Web site yet.

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