Wachovia Offering Financially Strapped Homeowners Cash, Deficiency Balance Waivers, Quick Closings To Encourage Short Sales & Avoid Foreclosure?

In San Diego, California, North County Times reports:

• Wachovia Corp. is offering its borrowers money for selling their houses short, rather than going into foreclosure. Homeowners with Wachovia mortgages who are upside down on their property can get 1 percent of the price of their short sale, with a minimum of $2,500. The incentives only kick in once the deal closes. [...] The program was originally intended to be temporary, but there's no fixed end date for it yet. A source in Wachovia's short sale unit said the program will definitely run through November, and probably beyond. The source preferred not to be named for fear of getting fired.(1)

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• Another key feature for borrowers is that Wachovia's program leaves them with no lingering mortgage debt. Across the nation, attorneys have reported that the fine print on short-sale contracts from major lenders hold borrowers responsible for the unpaid mortgage balance, and lenders have pursued collections in court after the sale. [...] The cash incentive is only one of several steps Wachovia is taking to promote and streamline short sales. The lender dramatically curtailed the amount of paperwork short sellers must provide to get a sale approved, allowing them to get a short sale closed in as little as 10 days.

For more, see Wachovia offers cash to spur homeowners into 'short sales' (Lender quietly giving $2,500 or more in incentives to avoid foreclosure).

(1) Wachovia is promoting the program quietly by inviting real estate agents to seminars run by employees from the bank's short sale unit, the story states. Reportedly, the only seminars currently available in California are taking place in the San Francisco Bay Area, but they will becoming to Southern California early next year, a Wachovia source said.