Foreclosures and Short Sales Class For Realtors
Foreclosures and short sales are so prevalent in some parts of Colorado that new forms have been developed to cope with those situations. The Colorado Real Estate Commission has even required that all Realtors attend an Update Class which describes foreclosures and short sales as well as how to use the forms.
Foreclosures and short sales have caused some depreciation in home values in parts of the Denver metropolitan area. This is great news for buyers generally. However, in our better neighborhoods, there has been little if any price depreciation. Areas like Greenwood Village, Highlands Ranch and Washington Park are examples of better neighborhoods that have not suffered from either any foreclosures or significant price depreciation.
Here is a portion of my interview with the class instructor, Oliver Francona:
Many investors and first-time homebuyers have been snapping up bargains on the foreclosure market and trying to buy short sales. In a short sale, the existing lender agrees to take a smaller payoff so the house can be sold at a lower price. It can be an difficult process which can take weeks if not months to negotiate.
All this activity in the foreclosure and short sale markets have created some confusion and even abuse. So, the Colorado real estate commission has mandated that all Realtors take An Update Class that includes information about these types of sales as well as the new mandated forms.
The Short Sale an Addendum form discloses the process to both buyer and seller. It also provides a date certain by which the lender must approve the short sale or the transaction is automatically terminated. The form and the information in the class is designed to better inform both Realtors and the public about the potential pitfalls in a short sale.
The Foreclosure Addendum is required to be used when the foreclosure process has actually begun. It also describes the foreclosure process to all the parties. It also requires that the seller use English as the primary language. Apparently non-English speaking sellers have been deceived by sophisticated investors as described in this foreclosure article.
We are fortunate in the state of Colorado to have a pro-active Real Estate Commission. They have identified problems, potential problems and disclosure issues. By providing these forms and the Update Class to Realtors, the public will be better informed and protected.
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