Obama Announces Short Sale Plan

U.S. Department of the Treasury Secretary Geithner announced details on the expansion of the Making Home Affordable program to include short sales under the new Foreclosure Alternatives Program. Financial incentives for servicers and borrowers include

• $1,000 to servicers "success fee" for a successful short sale
• Borrowers may receive up to $1,500 to assist with relocation expenses.

Reasonable and customary real estate commissions and selling costs will be permitted and the servicer will agree not to negotiate a lower sales commission after an offer has been received.

Program 3648, a privately owned, nationwide initiative, originally based on HR 3648 the Mortgage Forgiveness Debt Relief Act, is leveraging this and other legislation to help as many homeowners as possible avoid foreclosure by completing a short sale.