Here's one more angle on the mortgage foreclosure/short sale crisis.

This time it's about short sales, where an owner avoids foreclosure by selling a property for less than is owed on the mortgage. Investor digging in/refusal to accept reasonable short sale offers has the system totally stalled.  

This isn't good for taxpayers, because getting properties through the short sale process is one way of making sure that "the open market" (whatever that is anymore) takes responsibility for properties rather than various branches of govt. being stuck with managing vacant, vandalized properties in troubled neighborhoods.  

If you can make one more call to your congresscritters: they may not want to get involved because in theory these are private contracts, but since the taxpayers are the ultimate bagholders, they may be open to the idea.  

1. Consolidation in the mortgage industry has rolled most bad loans back to FNMA as the investor.  

2. FNMA has guidelines for accepting/rejecting short sale offers. They have an obligation to their investors (and to their ultimate investor, the fed gov) to get the best value for the mortgages. In troubled neighborhoods, where properties that go vacant have a high likelihood of being vandalized and rendered almost worthless ($0-$20k, almost a 100% loss from their original mortgage "values" ), it seems to me that FNMA ought to be encouraged to accept any remotely reasonable offer which will keep a property occupied and not vandalized. This will capture more value for shareholders in the long run as well as saving money for state, county and local governments who get stuck dealing with vacant properties.  

In other words, no more lockouts in vandalism-prone areas if there's any possibility of preventing them. Perhaps FNMA negotiators could be provided with maps of these areas to help them make their decisions. You may even be able to encourage FNMA to provide the loan servicers with these maps so that loan servicers will understand that if preserving values in these areas, vacancies are to be avoided at all costs.....  

Seems to me it's worth a try--if taxpayers are ultimately going to be holding the bag for the foreclosure crisis, which looks likely, getting private investors (the short buyers) to take up as much slack as possible would at least save taxpayers the cost of managing vacant properties!