Short Sales Dominate Housing Market - 8 News NOW

Desert Underwater

I-Team: Short Sales Dominate Housing Market

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Cortney Woods Cortney Woods

LAS VEGAS -- Short sales now account for half the properties on the Las Vegas market. For some people, it means putting their lives on hold. For others, it's an opportunity to get a good deal.

Short sales are often the last resort for Nevadans who try loan modification and court mediation. Pulling the plug on an underwater mortgage has its benefits and obstacles that homeowners need to know.

"I was here last weekend and across the street, it's not there, but that house also had a foreclosure notice," said realtor Jeff Mix. Danforth Avenue is like most southwest Las Vegas neighborhoods. "Active on the market there are about 11,000 properties and 5,500 of them are short sales," Mix said.

"That's the traumatic part about it. It's complete chaos sometimes," Cortney Wood said. She lives life half-packed, half-unpacked. She bought her house in 2008 for $285,000. She and her husband lost their jobs and her new business, making custom cakes, isn't bringing in the same money. They opted to do a short sale after their bank's mediation offer fell far short.

"When we finally went to mediation, they finally offered us a modification. A dollar off our payment," Wood said. "We were figuring out where we were going to spend it."

For every successful short sale, there is a buyer snatching up the opportunity.

"I do feel guilty. You're walking through someone's house. They're selling it for a third of what they bought it for," buyer Daniel Ibeling said.

Ibeling is a Las Vegas Strip casino entertainer buying his first home.

"There's a little bit of animosity coming from these people. It's something you have to deal with. It's like you're stealing their home from them. It's a little awkward," he said.

He the house he bought used to sell for $280,000. He's buying it for $90,000. "I got quoted at 3.75 percent. It's just like, God, what are you waiting for?"

Half of short sale offers fail to close because sellers often realize the law may hold them accountable for debts if they don't get a bank's written approval.

"The most important thing is Nevada is a deficiency state. So in a short sale, if the lender doesn't forgive the deficiency in the written approval, the first and the second loan has six years to pursue the deficiency," Mix said.

"People really need to just let go of it and make the best of what their situation is. Move on. It's just a house," Wood said.

"People panic. Vegas isn't Atlantis. It isn't going to disappear into the ocean. These homes will go up eventually. It will take a while," Ibeling said.

If you want to find out how much money you could save if you do a short sale on your underwater house, use this link.

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