Some the owner will try to modify the loan, but loan modification its just a temorrary solution to the real problem.
So foreclosure is the answer.
Best of luck!
Covering all of San Diego
Residential Sales and Appraisal
And then there is the current limbo, created by government intervention PLUS overload at the lenders, where the person has not made their payments and the bank has not filed for foreclosure. I know of several home squatters who have not made their payments in over a year, the bank has not filed a Notice of Default, and they are just staying in the house and hoping they "slip through the cracks" a while longer until the "market turns" and they can refinance or get a loan modification. Someone who is living rent free has little motivation to complete a short sale. And, some who do then have to be evicted so the new homeowner can take possession of their home.
So, if you are looking to purchase a short sale, make sure that the listing agent knows what they are doing, the seller has a real hardship, AND they are motivated to sell and move (or already have moved). I have closed 100% of my short sale listings to date and never had a problem with the seller moving out at close of escrow. Additionally, when representing buyers, I have worked with listing agents to assist in getting their short sales closed. When purchasing a short sale, if negotiated correctly, you are getting the best of both worlds - foreclosure pricing on a home that is occupied by the owner who will give full disclosures, water the yard and not totally trash the property in anger (although there might be deferred maintenance due to the fact that the owner is broke). Dare to Dream.
Real Estate Consultant
RE/MAX Palos Verdes Realty
see link below for more info on how short sales work