Foreclosure in Los Angeles>Question Details

Lynn, Home Buyer in Los Angeles, CA

I have literally been waiting for a short sale house for over 13 months now. Is that too long?

Asked by Lynn, Los Angeles, CA Tue May 25, 2010

t seemed like we were finally about to close but then the appraiser came back with his report and we have been told it might all fall though. I know this is not normal, but am I completely being taken advantage of?

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Benny Chavez’s answer
Not necesarily I have had a short sale take one year and two months to get approved! Of course this was in the time when short sales were new to the current financial giants. The job of the appraiser is to give real value to the bank and point out any items that could affect the habitability of the property. Based on this appraisal, buyers qualifications, and terms of purchase the bank can and will either issue the loan or reject it. Another factor that could be affecting you could be the approval of the short sale by the current lienholder of the property. If the short sale has been approved then the problem is on your lenders side. If the appraisal has determined the value to be less than the purchase price or the property condition to be less than par you just might be saving yourself years of repairs and financial trouble. Good Luck
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0 votes Thank Flag Link Tue Jun 1, 2010
One issue would be that the bank has aged documents and anything older that 90 days would have to be updated. But there is no reason you should not be able to get a status form the bank. Someone needs to escalate this to someone to get an answer right away. I am thinking the bank will at least need a new hud 1 with estimated expenses.

Keith Manson
First Weber Group
Certiifed Distressed Property Expert
Metro Milwaukee
0 votes Thank Flag Link Sun May 30, 2010
HI Lynn,
It may fall through and it may go through.
Be patient it sounds like you are close to the end.
Yes 11 months is a long time.

Harold Sharpe - Broker
So Cal Homes Realty
(951) 821-8211
California Department of Real Estate License # 01312992
0 votes Thank Flag Link Wed May 26, 2010
Hi Lynn,

It's an awfully long time. However, it seems that your agent is communicating with the listing agent who is in contact the bank which indicates to me that that the agents are doing all that they can. Moreover, if you can hang on a bit longer, after waiting this long, you might see th elight at the end o f the tunnel. I'd imagine if the bank was going to deny the sale, you'd have heard so by now. I applaud your patience and I wish you a great deal of luck.

Lynn LeGlaire
Keller Williams Realty
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0 votes Thank Flag Link Wed May 26, 2010
Hi Lynn, 13 months certainly seems too long doesn't it - last year I closed on a short sale and it took 8 months, which seemed like an excruciatingly long time. The buyer loved the home and so she waited it out, but the process took a great toll. And of course in a declining market, 8 months - or your 13 months - can make a good, or even great, deal originally negotiated/accepted by the bank seem just barely acceptable or even over market at close -- and man, that adds to the frustration of it all.

Sounds to me that the negative impact of time has hit your transaction by your comment on the appraisal. If the appraisal has come up lower than your price, either you have to bring more money to the table or the bank will have to accept less.

Good luck,
Jeanne Feenick
Unwavering Commitment to Service
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0 votes Thank Flag Link Wed May 26, 2010
It's longer than average. On the other hand, I've talked to people who waited 15 and 16 months.

Let me ask you: Is the house really worth it? Really? Is it your dream home? If so, hang in there.

Otherwise, move on with your life. You've got over a year invested in this effort. On a traditional purchase, you'd have bought the home and be celebrating your 1-year anniversary in your new place. Babies born when you made your offer are now up and walking around. That's a long time, and you've been sitting dead in the water.

I know. It's kind of like playing the slot machines. The next pull may result in the payoff. And it might. And you're thinking of the 13 months of effort you've put into this.

Still, take a step back. Take a deep breath. And take a look at what's on the market now. Ask yourself: "Is this really worth it?"

Hope that helps.
0 votes Thank Flag Link Wed May 26, 2010
Don Tepper, Real Estate Pro in Burke, VA
Pebble Singha
Certified Distressed Property Expert

Lot of good answers.Lynn even though 13 months is a long time, looks like the listing agent has worked very hard to get this thru. Have the listing agent present the appraisal to the Lien holder. I have closed over 40 short sales. I will tell you by experience that it depends on the bank and its investors. I have had a 70% success. If it is ING for example... its not happening. ING is oe of the toughest line PNc and National city.

So i suggest you have the listing agent present the appraisal to the bank and from there it depends on the bank. Tell u what if they don't accept your offer, it may come back as a REO. You still have a chance.
At that time show this offer to the listing agent most likely you will get thru.
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0 votes Thank Flag Link Tue May 25, 2010
Hi Lynn, the best way to answer your question is to to get on the phone with the listing office and your agent for answers. If the appraisal fell through it could simply mean that the offer the lender accepted was too high at which point you need to have the listing office submit the appraisal to the current lender(s). If the home has Bank of America as the lienholders then they may not even bother with the review at which point you have to bring in cash to offset the difference. If it is an FHA appraisal, repairs may be in order for you to obtain the home. In short sales, a "negotiating" team is simply a processor or an agent which is is organized and knows what documents to properly send to a lender as well as push the lender to move a file forward quick. It is very rare that you can actually negotiate a lower price than 10% of market value on a home unless you have a home inspection that can back up damages.

Get on the phone with your agent and the listing agent and find out what the issues may be, how many lenders are involved, and where the files are with each lender. It is in the best of all parties to know exactly what is going on and what is happening so both buyer and seller succeed. The longest short sale I have dealt with was 9 months, and me and my team do close to 10 a month.

Ramin Lavi
Dre# 01797965
0 votes Thank Flag Link Tue May 25, 2010
Since you've stuck it out this long, for this particular house already, don't give up. Your listing agent apparently doesn't know what the heck they're doing for it to drag on like this.

At this point you should insist that if the listing agent isn't using a good 3rd party negotiator, they need to get one on board to assist. I would be happy to give your listing agent a referral to someone who can help to get this closed. The listing agent, at this point needs to get past the $10/hr "negotiators" at the bank & move on to a Senior VP or other upper level contact.

Definitely send in the appraisal report to the bank. The bank MUST sell at current Fair Market Value so you can get your loan. The original BPO report or appraisal the bank did is either wrong or outdated & the bank needs to see what is going on NOW, not 4mos. ago., with regards to NEW comps.

If the listing agent doesn't want to get a 3rd party negotiator now, just make DARN sure that the appraisal report, gets in to the bank immediately!
562-430-3053 cell
0 votes Thank Flag Link Tue May 25, 2010
Lynn - Thirteen months is on the longer side of a short sale transaction but unfortunately every so often this process can be lengthy. If this home is "the one" for you then I hope it comes to fruition and your patience will be rewarded. On the other hand, the appraisal contigency appears to be very revealing as to the value of the property and contract. I would welcome this news positively in deciding the next step with your Realtor or agent. All the best!
0 votes Thank Flag Link Tue May 25, 2010
I would say that the answer to your question is yes that is too long. With the market still softening I would have your agent look at homes in the area you are trying to purchase and see if there is now a better deal out there. The home may not even appraise for the offer price. I would look into it to avoid further delays and frustrations. I feel for you. Good luck.

Best Regards,

Eric Soderlund
0 votes Thank Flag Link Tue May 25, 2010
This is longer than average for sure, but I have heard of longer. Do you have short sale approval from the bank? If so, when did you get it? Are there one or two lenders involved? You can ask YOUR mortgage lender if he has friends at those banks that can push things along. Also, how did the appraisal come out? Did the bank order a 2nd appraisal? You need to let me know what pieces of the puzzle are in play and what the actual hold up is due to.
0 votes Thank Flag Link Tue May 25, 2010
Have your short sale negotiator send the appraisal to the seller's lender certainly in 13 months the price you offered has changed most likely downward depending on where in the country you are - the housing market there that is
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0 votes Thank Flag Link Tue May 25, 2010
Have your short sale negotiator send the appraisal to the seller's lender certainly in 13 months the price you offered has changed most likely downward depending on where in the country you are - the housing market there that is
Web Reference:
0 votes Thank Flag Link Tue May 25, 2010
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