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Foreclosed Homes Prevention Program to Benefit South Florida
May 18th, 2009 by 
Joseph Smith
Distressed homeowners in South Florida who are facing foreclosure or who owe more than the value of their properties are provided hope by the enlarged $75 billion forclosed homes prevention program announced by the Obama Administration.
The forclosed homes prevention plan has offered additional incentives to lenders who work with distressed homeowners who have difficulty refinancing or qualifying for loan modifications.
The housing rescue plan aims to simplify the short sales process. Short sale involves selling a property for less than the total mortgage owed by the homeowner and the transfer of property ownership to lenders without foreclosing. The effects of short sale is said to be less devastating and damaging than foreclosure. However, homeowners who opt for the short sale method to avoid foreclosure should expect to have a ruined credit score.
Troubled homeowners in South Florida would be happy to note that the Obama Administration intended to shell out funds to motivate lenders to alter loan terms.
Housing counselors have complained that lenders are having difficulty implementing the new guidelines on loan modification. In South Florida, foreclosures continue to rise despite efforts to alter loans.
RealtyTrac’s April data showed that the number of forclosed homes in both Broward and Miami-Dade counties increased by over 90 percent compared with figures for the same month a year ago. In Miami-Dade, about 11,299 homeowners received foreclosure notices and were scheduled for repossession or auctions by lenders.
In Broward, the total number of homeowners who received foreclosure notices in April reached 10,305.
According to Esslinger Wooten Maxwell Realtors President Ron Shuffield, short sales accounted for nearly 35 percent of forclosed homes listed in the Multiple Listing Service for sale on the open market.
On the other hand, Neighborhood Housing Services director of homeownership Michael van Zalingen noted that employees at lending institutions are either driving away distressed homeowners from the Obama Administration’s Making Home Affordable program or are clueless or unaware of the foreclosure prevention plan.
Foreclosure defense lawyer Dennis Donet pointed out that South Florida homeowners are facing unique challenges when trying to modify their loans.
He explained that lenders are requiring South Florida borrowers to provide a full documentation of their income, which is a difficult requirement to comply with especially by distressed self-employed homeowners who want to avoid forclosed homes.
