Then Uncle Sam got involved. As foreclosures mounted, the government began a series of steps to stem the tide. The thinking in Washington was to take action before the banks ended up taking properties back. First came the foreclosure moratoriums. The next step was to address all those people in trouble by modifying their loans wherever possible. The government came up with the home affordable modification program (HAMP). Then the government came up with the homes affordable foreclosure alternative (HAFA). Short sales became the order of the day.
A short sale is a transaction in which the bank agrees to accept less than the balance owed so that a homeowner who cannot keep paying the mortgage may have a more respectable outcome than foreclosure.
Up to now, JoAnn and I had dealt with regular clients. Sure, they came in all sizes and shapes, but they had normal motivations. Even the banks just wanted their foreclosed properties to be sold. The short sale created a whole new kind of client, the distressed seller, with all that the situation entailed.