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Consumers attempting to dispose of “underwater” real estate by conducting a short sale, in which lenders accept a payoff of less than the full amount due, are having an easier time than in recent years, though the transactions are still burdensome, the California Association of Realtors trade group is reporting.

In the group’s most recent Lender Satisfaction Survey, 64 percent of real estate agents reported that their clients experienced difficulty in attempting to close short sales, down from a peak of 77 percent in 2011 but still representing nearly two-thirds of all such transactions, which make up a large but declining share of local sales. 15 percent of all transactions in San Diego County closed last month were categorized as “distressed,” down from 25 percent a year ago and well below neighboring Riverside County, where half of all transactions are either short sales or bank foreclosures. San Diego’s proportion of distress sales was by far the lowest in the state, with Santa Clara County next at 22 percent. An above-average price recovery in the region is likely contributing to the lower incidence of distressed units on the market.

“While it’s encouraging that lenders and servicers are making headway in improving their short sale processes, they still have more work to do,” offered Association president LeFrancis Arnold. “With short sales being a better option than foreclosure for both struggling homeowners and lenders, it’s important that lenders continue to improve their processes so that losses incurred by homeowners, lenders, and taxpayers are limited.”

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