The problem is that banks often run the foreclosure process in parallel with the short sale process, and, with the bank, the left hand does not know what the right hand is doing, and it can be a race to the finish line.
To learn about why short sales are a good investment and why banks prefer them over foreclosure, you can check out an article I wrote on this entitled "Looking for Real Estate Deals? Consider Short Sales"
Simon Campbell - http://www.bankforeclosuressale.com
These complex, illogical, abusive, convoluted, opague transactions do not have a 'good faith' party on the opposite side of the table. Banks can and do whatever they want.
70 percent of the time, the buyer can no longer stand the abuse and bail out of the process. All that time is wasted! Very few buyers are good candidates for a short sales. Because of this predictable pattern of failure, a successful short sale will be the outcome of a rigorous pre-qualification process imposed by the home owner. The owner must insure a buyer will stay engaged and able to adapt to what will eventually happen dictated by the buyers bank AND the bank managing the short sale.
As others have stated...the banks are the CAUSE of these 'taking forever' short sale. Behind their curtain of secrecy, stuff happens that to the buyer and seller all that secret stuff appears as absolute craziness. But in the end...THE BANK ALWAYS MAKES MONEY!!!
If you have what it takes, shorties can be an option. 30% do succeed.
Prudential California Realty
Beverly Hills, CA
Andrew G. Belcher
CA. Broker Lic. 01707173
468 N. Camden Dr.
Beverly Hills, CA. 90210
Bottom line, the bank Does NOT want to foreclose, they prefer a short sale because they will Net More $$$$. UNLESS the short sale offer they're receiving is a total low ball, then they'll just deny it & if you're inching close to an auction date & there are no more offers being submitted by your agent to the bank then Yes they would just foreclose. So, make sure the offer is not a total unexplainable (to an appraiser giving reasons) low ball offer that makes no sense to the bank.
You've been asking so many questions related to What if this & What if that? Pertaining to short sales, I am a valuable resource & can answer each & every one of your questions VERY Thoroughly,,, Do you have a home that you're needing to short sell or are you contemplating buying a short sale home, I recall one of your earlier question, I thought it started out as "I'm selling short my home & .....?"
Shoot me an email directly if you would like to talk about this further. I don't look back on this same Trulia posting for answers after mine.
Emily S. Knell
Realtor Since 1996
Realty ONE Group
100% short sale success ratio
& I can Prove it