Thank you for your helpful responses!!! I will wait a little longer especially since the 8,000 tax credit has been extended.

Short sale approvals can take a very long time. It is a frustrating process, but probably worth it if you want a good deal and really like the house. For my buyers, I always check up on the listing agent to verify they know what they are doing. Do you know what the sellers hardship is? This may be the reason the approval from the first is being delayed. The seller may not have a valid reason to sell the home short, and their bank may be holding them accountable for the difference. Your agent needs to get involved in this transaction and find out all the details. Hang in there, most short sales today will close escrow.

Good Luck

I had waited so long for the house and they knew I wanted it and I felt that they would have my best interest in mind. Hind sight is 20/20. I never have done that and never will again. I have learned not to be emotional about a business transaction. I did, however, ask if they had asked for proof from the listing agent substantiating the claim that it was a "bank approved" short sale and they said it was a verbal approval and that is what I feel I would have appreciated more scrutinty on the part of my agent that I didn't get.

Well said Michael! There is really nothing more to add to that answer.

It sounds like you still have a deal. If you really want the home, then you may want to be patient. You may also want to keep looking at other homes. If you can find a standard sale or bank owned property, and get an accepted offer, then you can cancel this short sale.

There is a clause in the short sale addendum that defines a certain date in the future. If you don't have bank approval by that date, then either party can cancel. Read it carefully. Talk to your agent. If you are feeling like you need more support, sit down with the broker or office manager and get your answers there.

Are you comfortable with your agent signing forms that you have not seen?

I had been waiting 9 months for the house to become available and was told the house was ready and I needed to get funding and be able to close in 30 days, I was told it was bank approved. I told my agent to get the process started and did not see the Short Sale Addendum which my agent signed for me to hurry the process. It's been 3 months and still no approval on the first but approval on the smaller second. I feel insecure like I'm waiting and at the end of the line is it possible I still won't get the house after waiting so long and it looks like the 8,000 tax credit will run out. I don't know what to do. They let my original financing expire and escrow was extended 2 times but I don't want to restart my financing until it is approved. Do I technically still have a deal?

Great answers below. Yes you can cancel escrow. It's an official escrow if the seller accepted the offer, however there is much debate about the circumstance. Was your deposit check cashed yet? Did your agent use the short sale addendum? Did you already sign escrow instructions? How long has it been since you began escrow? What penalties did you agree to?

All of these questions are very important, and if you are working with an agent, need to be discussed asap.

We have the same addendum in California. Did you sign a form labeled "Short Sale Addendum (CAR Form SSA, 4/09)"? What date was in Section A? Read through the addendum and you should have your answers.

What did your realtor tell you regarding your question?

To answer your question...Yes you can since you officially but unofficially do not have an accepted offer since the bank or banks will still need to approve the offer you have submitted into the seller.

Please ask your agent if they used the "Short Sale Addendum" with your offer. The "SSA" is a form which helps protect you as a buyer when trying to purchase a home in a short sale situation. This form specifies how your deposit, the time frames within the contract and how long your offer is valid for will all be handled during your waiting period for the bank to respond to your offer.

Maddog,
I will refer you to your Realtor, as every state is different, but in AZ, the offer would have had a "short sale addendum" attached to it, which has verbiage that allows the Buyer to withdraw their offer unilaterally at any time until you receive notification of acceptance from the seller's lender. You should always consult your contract and your Realtor to confirm.

Heather Werner, Broker
Ravenswood Realty