Banks are forcing underwater homeowners to default in order to qualify for a short sale, causing these homeowners to be mislabeled as strategic defaulters. (Strategic defaulters are those that can make their mortgage payment but choose not to.)
This bank policy of requiring late mortgage payments before the short sale automatically disqualifies homeowners from getting an FHA mortgage for three years.
Lenders, the US Treasury, FHFA, and Making Homes Affordable all are aware of this problem. Yet, nothing has been done to correct this policy. This inaction is directly preventing thousands of short sellers from reentering the housing market.
Put a stop now to the damaging practice of lenders forcing underwater homeowners to be late on their mortgage in order to qualify for a short sale.