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Amelia, Home Buyer in Marina Del Ray, Los...

how long does a short sale goes? I heard it takes too long and the process to buy on short sale is too rigorous, is that correct?

Asked by Amelia, Marina Del Ray, Los Angeles, CA Fri Jul 9, 2010

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It depends on a lot of things, which the first and most important is whcih mortgage company is the lender. Certain lenders are very proactive and others drag their feet.

When you start looking at short sale listings you need to understand that you are gettiing involved with more than a real estate transaction. The normal real estate transaction takes place but then the situation with the seller becomes a big inflence on if the the deal will be approved.

Questions that may effect the banks decision:

How many loans need to be addressed.
What is the hard shape
Does the seller have other assets
Will the lender go after a deficiency
What is the mortgage companies appraisal to confirm value (would the bank do better by going to foreclosure and reselling property)
How quickily does the negotiator at the bank react
Will the other lenders cooperate
Is the seller cooperative in the process


Keith Manson
First Weber Group
Certified Distressed Property Expert
Metro Milwaukee

http://www.milwaukeebailout.com
2 votes Thank Flag Link Sat Jul 10, 2010
Very good information!!
Flag Fri Jun 8, 2012
This depends on many factors... and I will axplain why you should ask all of these questions...

Who is the lien holder?
Every lender has different requirements and process to handle short sales. For Example : Bank of America has 3 phases in which each phase , the negotiator has 30-45 days to complete their tasks. Then you have other Banks such as Wachovia, who only takes a week!!!
How many loans ?
It is importan to ask this question because if you find a short sale that you LOVE and they tell you that Wachovia is the first lien Holder but there is a second with Bank of America, then you should expect it to take at least three monthsto obtain an approval.

How motivated is the seller?
As a buyer you may think that a seller facing hardship would be motivated to sell and save their credit from FORECLOSURE. I've got news for you... some sellers are not motivated enough to provide the necessary documents for the lender to process the short sale which could delay the process even more.

Are there any Home Equity line of Credits?
Lender may require more funds to settle the debt.


I disagree with Vince because you should not put an offer and continue to look for other properties after the seller has accepted your offer. I've been seeing this practice a lot lately and I can assure you that this will cause many Foreclosures. This will waste everybody's time and will put the seller in a really bad situation. Many of these sellers are close to getting a foreclosure date and once a seller accept your offer, it gets submitted to lender along with many documents from the seller. If you cancel after your offer gets processed then the process has to start from scratch and you just wasted the seller and the listing agent's time for 3-6 months. If you decide to go for a ShortbSale... just be patient, call your agent and ask for updates at least every other week, be persistent, it will pay off.

Here is a list of Banks that I've found to be more efficient in their Short Sale Negotiations (in my Experience)
WACHOVIA
AURORA
GMAC
LITTON
EMC
SLS
HSBC
INDYMAC
CITI
OCWEN
Suntrust
ING
US BANK
POPULAR MORTGAGE
1 vote Thank Flag Link Sat Jul 10, 2010
Short sales are by no means fast sales, unless already approved by the lender, therefore much patience is needed. As to the lenght time, it varies from lender to lender as some are quicker than others. Keep in mind that the owner(s) can accept whatever offer he/she wishes, but the lender decides to accept, reject or at times counter offer, thus a lot of red tape. While conducting your search for homes, don't rule out traditional sales as some may turn out to be a much better bargain.
1 vote Thank Flag Link Fri Jul 9, 2010
Short sales certainly take a very long time and be extremely frustrating for you and the agent you are working with. The problem is the bank has no timeline as far as when they need to get back to you. This can extend the process quite a bit. It really depends on the bank and how quickly they respond I have heard of some closing in as few as 30 days and other taking close to a year.
0 votes Thank Flag Link Mon Apr 8, 2013
Hello Amelia,
You have to have patience to buy a shortsale. If you are... the reward can be significant. If you have an experienced agent, this will definately speed the process up. I work many shortsales and understanding the process and steps helps anticipate what is going to be needed up front, next, etc. so an experienced agent can already have a lot of the work prepared in advance. To place a time frame... this is a rough estimate, however, from the time of acceptance of the offer between the buyer and seller and it gets submitted to the lender, The quickest I have ever personally seen was 6 weeks to the approval. And then a 30 day escrow. This only happened once... on average, my shortsale transactions have taken about 4 months from time of submission to the lender to closing of escrow. I hope this helps. Dont let what others say as being too long or hard, etc. affect your decision to preview shortsale properties.

There are some great shortsale properties out there. Also, the seller looking to sell through shortsale often keeps the property in much better condition that other types of distressed sales like foreclosures. I would say to do yourself a favor and look at it as an opportunity, not a potential problem.

I am always happy to assist.
Sincerely,
Richard "RJ" Kas (SFR, SRES)
"Representing the finest properties from Los Angeles worldwide"
KAS Properties - Coldwell Banker Previews International - Beverly Hills East
9388 Santa Monica Blvd, Beverly Hills, CA 90210
310.859-5334 office - 310.488.9826 mobile - 310-273-0670 fax ATT: RJ
RichardKas@gmail.com - http://www.RJforLA.com - DRE: 01352771
Sellers Buyers Investors Leasing Consulting
0 votes Thank Flag Link Fri Aug 6, 2010
Thank you for your question Amelia. Everyone wants to know how long it takes for a short sale.

The length of time it takes to close a short sale depends. It depends on you, your agent, the sellers agent, the lien holder, and the asset manager.

Since a short sale depends on so many different people it is easy to see why some short sales take longer than others.

Some banks are better at handling them than others for various reasons. If you have your eye on a house and know the lender a local agent give you an estimate.

The process is rigorous because the banks do not want to go through the process again, therefore, they require a lot of documentation.
0 votes Thank Flag Link Mon Jul 12, 2010
Short sale can take from couple of weeks to 6-7 months. Some conditions to speed the process:
If the seller, who is in financial distress, and the property are approved by the lender.
It is always good to have an agent who understands short sales, that will submit a complete package in timely manor and follow up with loss mitigation department.
As a buyer, ask a lot of questions to understand the situation and the process.

Best of luck,
Boaz Hanohov
Rodeo Realty
Beverly Hills
Lic 01850785

310.717.4409
http://www.USALUXURY.com
0 votes Thank Flag Link Fri Jul 9, 2010
Short sales can take a long time, it depends on who the bank is and how many short sales they have. In the last year I have had several short sales the shortest time period we had was 3 months to close and the other was 15 months. I usually tell people to put their offer in and forget about it while they continue to search for another home. I continue to follow up with the bank where we have an offer but they can be very time consuming with little results. Best of luck~

Vince Lombardi
Real Estate and Mortgage Services
Direct: (310) 489-5608
eFax (310) 919-0303
0 votes Thank Flag Link Fri Jul 9, 2010
Hi Amelia,
The process on a short sale, for the buyer, is no more rigorous than a retail sale or an REO/ Foreclosure. You get to inspect the home, have loan and appraisal contingencies, etc. What is more difficult is that you must wait for the seller's lender/ investor approval of your offer prior to proceeding with your escrow. This can be a short or long wait, depending on the caliber of the listing agent, the willingness of the seller to provide the necessary documentation to the lender/ investor, and the speed at which the lender makes decisions. I had one this year with Wells Fargo that was fully approved in 19 days, and one with BofA that took 3 months.
If you have interest in purchasing via short sale, there are several important things to do that can be the difference between getting the home, or not. They are:
1. Get a buyer agent to represent you exclusively (not the listing agent). They should have one or more of the following designations: Certified Distressed Property Expert (CDPE) Certified Short Sale Professional (CSP) or Short Sale Foreclosure Resource (SFR) in addition to being an Accredited Buyer Representative (ABR) and a member of REBAC (Real Estate Buyer's Agent Council). This way you can be confident that the Realtor you choose is representing your interests and is an expert in the field of short sale purchases.
2. Have your agent ask a series of questions of the listing agent to be sure that they know how to handle a short sale, have a compliant seller, and have experience closing short sales. I have created a list of questions that I ask in order to ascertain the likelihood that the short sale will close. If not, I advise my buyers that this may not be the property for them.
3. Make sure you have the temperament, willingness, and time line to purchase a short sale. I created a video of a young couple who successfully purchased a short sale, telling potential buyers about the good, the bad, and the ugly of short sales, and what to reasonably expect. You can watch it at http://www.youtube.com/watch?v=WACxMut0fWQ
Short sales can be a great way to take advantage of getting a bargain, but you must set yourself up for success in advance, or, as many have found, they can be very frustrating.
Best,
Debbie Bremner
ABR, CDPE, SFR, CSP, REBAC
DRE LIC #00588885
Direct 310-571-1364
Cell 818-564-6591
Blogging at http//:thebremnergroup/news
0 votes Thank Flag Link Fri Jul 9, 2010
I had 2 clients with short sales running into this year. Both took 10 months--one got it, the other did not (she is now in a regular sale). Ask yourself how long you are willing to wait. And what is the risk if you don't get it? Major banks are aware of this frustration and have integrated new software to assist in streamlining the process. But there are no guarantees.
0 votes Thank Flag Link Fri Jul 9, 2010
Hi Amelia, all the answers below are correct in one form or another. The process can take anywhere from 10 days with GMAC loans, to 5 months with a Chase loan. It just depends on the lender and of course the listing agents ability and the seller's motivation. The most frustrating thing for many buyers who make offers on short sales is the lack of communication between the parties. I have seen many buyers become dissapointed with the process and just give up because their offers are denied, or the seller changes their mind through the process.

You can call me direct and we can go over the process from start to finish. Many home buyers find that as long as they are informed of the process they stick it out just long enough to get that dream home. Often times as well buyers feel they are getting the deal of the century with short sales, it is not always the case. Most short sales are bought just at market value or slighly below.

I look forward to hearing from you.

Ramin Lavi
#01797965
213-802-1232
rlavi@eqemail.com
0 votes Thank Flag Link Fri Jul 9, 2010
Amelia, you have been given very solid answers below to your question. I have been trained in the distressed property market and continue to receive monthly training. It is very helpful if a REALTOR has the designation CDPE (Certified Distressed Property Expert) or the SFR (Short Sale & Foreclosure Resource Certification). This means that agent has received very specialized training and education in this area. These transactions can be complicated, and yes, very lengthy. I do know that a Wachovia or Wells Fargo loan process is more streamlined than other loan companies' processes. I hope my answer is also helpful to you!
Deborah London, CDPE, GRI
0 votes Thank Flag Link Fri Jul 9, 2010
Short sales can take anywhere from 3wks-5mos to get approved. It's tough from the buyer point of view, you never really know if the listing agent knows what they're doing or not. If you have the patience you can get an excellent deal with a short sale. The key is the listing agent must meet the banks' appraiser & present a good case for value.

Let me know if you'd like to talk about it further, feel free to email me ANY & all questions that concern you about the process. What if this? What if that? etc.

EmilyKnell1@yahoo.com
562-430-3053 cell
0 votes Thank Flag Link Fri Jul 9, 2010
It is true that short sales take longer than standard sales. The tough part is that when an agent makes an offer, or lists a property, there is no good way to PREDICT the time frame. I have gotten short sales approved in less than 1 month, and others took 5 months. Buying a short sale takes strong nerves and patience on part of the buyer. Now that the deadline for the tax credit is past (which made buyers hoping for a timely approval bite their nails) short sale purchases can be viable options if the home is exceptionally well suited to the buyer's needs. Don't be misled by a very low list price. The lender will counter with a price closer to market value. It is important that a buyer's agent knows market values to make a realistic offer that has a good chance of acceptance.
0 votes Thank Flag Link Fri Jul 9, 2010
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