Home Short Sales Up In 2012
If you think you saw a lot of short sales listed in the real estate section last year, you're right. Foreclosure listing site, RealtyTrac, says there nearly three times as many short sales as there were foreclosures in 2012.
A short sale is when a homeowner sells their property for less than its worth and the bank agrees to absorb the loss. The biggest spike happened in the last half of the year. That was partly because of a program that gave banks credit when they approved short sales.
Another reason for the surge was fear that the Mortgage Forgiveness Debt Relief Act would expire. If that happened, homeowners would have had to start paying income taxes on their forgiven mortgages.
The growing number of short sales helped boost the housing market and push distressed home prices higher last year.