Senate bill requires response to short sale requests within 75 days

Zillow: Housing recovery slows to steadier pace Zillow: Housing recovery slows to steadier pace Posted on April 25, 2013 – 11:54 AM by Laura Hepworth After months of robust and seemingly unsustainable annual home value appreciation, the housing market is showing signs of moderation in the first quarter, according to data from Zillow .

The new law essentially requires, after a short sale has already been approved, for the lender to respond to a request for a short-pay demand statement within 21 days. The lender’s response to escrow can be a short-pay demand statement or even, depending on the circumstances, a written statement electing not to proceed with the proposed transaction.

Recently enacted Senate Bill 306 does not require lenders to review short sale requests from sellers and their agents within 21 days. The new California law, which addresses certain escrow procedures, has been characterized by some practitioners as landmark legislation calling for a 21-day turnaround for short sale approvals.

Requires a written response of an acceptance, rejection, counter offer, or the need for an extension of time within 75 days of a request from a homeowner. Creates a $1,000 penalty for those that don’t comply, along with legal fees.

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