Bill: My eBook about Short Sales answers all these questions and more. .
You can read it HERE: http://reallynicehomes.com/PDF/The_Short_Sale_Option.pdf

I am a professional short sale negotiator, every lender is different, as is every scenario, not every short sale will be successful, but a key point in getting the lenders to even look at your short sale package is how it is presented, at this time many lenders are swamped with requests for short sales, however many of these packages are not thorough, which makes it difficult for the lender to seriously consider the low offers they are receiving.

All good info. For more short sale info including the documents needed go to http://www.foreclosuremillionaires.com

I submitted an offer for a CASH buyer a little over a month ago for a buyer- they wanted to go about 30K below asking price since the home needs some TLC and then some! The Bank took 34 days to even respond after 20 phone calls from the listing agent and they did not even counter back- "REJECTED"- they buyer and I were stunned- so we moved on to greener pastures- Banks are acting very unrealistic especially if they are from another state- they just don't seem to get it yet- but hey- in a few more rounds of that stuff and they will be calling me back to find out where that CASH buyer is!!

I am seeing quite a few short sales being done in my area and many great deals being made by the Buyer. I have heard of banks taking large losses (100k+) and don't think any offer is unreasonable as the banks are flooded with inventory they want to get off their books. I think most importantly is to be highly qualified to purchase and to have an agent who knows how best to represent you to the bank and/or listing agent representing the bank. Having a properly written and thorough Contract of Sale is crucial in getting your offer taken seriously and to start the negotiating process. I think 30-60 days is a reasonable expectation to purchase as short sales are becomming very common and most banks are ready and willing to look at offers rather then increase inventory. I have seen them cover closing costs for Buyers, etc. This is largely dependent on how long the property has been for sale and how badly they want to unload it. Now is a great time to buy!!

The term short sale in no way indicates the sale is completed in a brief period of time. Usually a minimum of 30 plus days to the long side of six month. Banks are not looking to discount as they are already taking a loss. They want to sell the property "as Is", no credit for closing costs and a market value.

The banks are looking for market value in a short sale. If you are looking for a good buy you may be better off looking at a property that has been on the market for a while. One that was overpriced priced to begin with, the sellers bought it more than 3-4 years ago and they have equity in the house. You stand a much better chance of making a lower offer, asking for closing help and having it accepted and go through in a timely matter.

Susan G.,

"There is no guarantee but it is better than a foreclosure if you can accomplish it!"

Why is a short sale better than a foreclosure? I am a foreclosure moron.

I just pult the wraps on a short sale negotiation today that took 5 MONTHS to complete. Frustrating! The banks are looking to maximize their $$$....if you submit an offer, make sure your agent submits it as clean as possible. Most folks think short sales are great deals...they are not always! The bak wants market value. Good luck!

There was just an article about this in the Washington Post and I have linked it below.

It is difficult to impossible to get a bank to consider a seller concession to help you with closing costs. They are getting their own appraisal of the property and if they feel like your offer is too far below what the appraised value of the property is they are going to be more likely to take their chances with a foreclosure auction. Hard to believe but it's true.

The owners who are choosing the list price for the property have usually done so independantly of their lender who is a breath away from owning the property. There is no real benefit to seller to sell a short sale, except for maybe saving face. Whether or not it goes to actual foreclosure, it is a foreclosure on their credit. Many times the lender would rather wait until they have full control of the property and then deal with selling it. This may change in the future since banks are not going to want to have a huge inventory of homes, but I haven't seen it up to this point.

Don't mean to rain on your parade. You can always try, but just be prepared for a bumpy ride.

Patience is the key! Your agent needs to stay in constant communication with the bank. I have had short sales that closed in 45 days and some that never closed in spite of having offers waiting. There is no guarantee but it is better than a foreclosure if you can accomplish it!

There is no hard and fast rule about this. Since this is a loss mitigation issue, banks will typically try to balance their time on the market (their holding costs) vs letting it go. Your agent should be able to help you develop your strategy with each case and help you to negotiate. The bank may even delay decisions on your offer waiting to see what other offers come in. Even when they like your offer and are willing accept there could be a series of delays because you may be dealing with two lenders on the other side and not one. Best of luck.

I have heard of as short as 30 days, but mostly I have seen it take several months before the bank approves it. Meanwhile, you stay in limbo on that property.

There is so much variation in time that banks act upon an offer - it can be almost immediate to never! I think it matters how much inventory they have and if they have a buyer of their own that they are trying to get approved to take over the property/loan!
If you have placed an offer, is all the things in place, letter from current owner to the bank, Brokers BPOs, an appraisers opinion letter, etc. If you are dealing with a Realtor that is experienced in short sales, they should know all thats required, but lately I have had many buyers come to me totally frustrated and my first call is to their Realtor and the first question is "how many short sales have you done?' Make sure your Realtor is experienced, or they will never get the bank/mortgge company to respond.

Bill Wootan

It could take up to 45 days for a bank to approve a short sale and they typically do not cover any closing costs. In addition the home is usually sold in as-is condition. For this reason you can usually expect to pay less than market value but by how much is going to vary from one home to another. You'll need to have patience to get through the process.