Holly,

We have had a lot of good experiences with most of our short sales but there were these 3 occasions... We represented the sellers in all 3 of the short sales. The buyers were represented by a cooperating agent.

Deal 1: We received a telephone call stating a verbal acceptance of a deal. The bank said they would fax us the acceptance in writing along with final instructions. The fax would have a "good through" date and miscellaneous instructions for the title company. It came a week later but we called the bank every day to make sure.

Deal 2: We received a verbal acceptance but they wanted to postpone the final acceptance because they wanted to order another appraisal. That took several months to go through the 2nd appraisal. We were all thoroughly stressed and unable to speak to anyone with insight for weeks on end. Until, finally both the me and the buyer's agent teamed up and bombarded the bank representative and her manager with emails, faxes, and voice mail. We got the the final acceptance shortly after verbally followed by a fax similar to the Deal 1 above.

Deal 3: We were told verbally that our short sale was approved and an acceptance notice would be faxed to us. We thought " Fantastic!" But, I received a phone call the next day from the very same bank representative handling the file and she said that yes, the short sale was accepted but that the lender will not forgive the difference that was owed on the property. (For our client it was about $60,000.) The seller (who was obviously in financial distress) would have to pay 10% ($6,000) of what is owed on the property in cash at settlement or the short sale wold be denied. The alternative was that the seller would need to take a $60,000 interest free note for 30 years. Well, that could have held us up indefinitely but we negotiated a $2,500 cash settlement and the bank accepted it. (A kick you when you are down scenario).

"Is this normal?" There is no normal. Thus, my 3 examples above. It certainly seems common place for the bank to follow up a verbal response with a written one. It also seems reasonable that you would expect to see that confirmation. If there is a delay there must be a reason. Both agents need to work together to make this happen.

My suggestion is to have your agent make sure all extensions and addendums are properly signed to make sure you stay in contract if things delay any further. (That is assuming you want to stay in contract and buy this home.) My other suggestion is that your ask your agent to continue to follow up every couple of days if need be and have the seller's agent do the same.

It is hard work but it is worth it. We have seen many happy short sale settlements.

Holly: Unfortunately, a short sale is a two-headed monster. Your actual contract is with the owner, not the mortgage holder. The mortgage holder (the bank) doesn't own and cannot sell the property. They can only allow or refuse to let the owner off the hook for less than the full amount of the mortgage. Your offer, ostensibly, is that lesser amount.

Since you are dealing with any one of hundreds of banks and thousands of managers, it's difficult to get either a standard answer or an answer that is necessarily fair to you. Some managers at banks feel that they don't have the time to be responsive and that the owner is a bad guy for getting into trouble and therefore a further annoyance. This doesn't help the buyer, now does it?

You have only two real options: One, withdraw your offer and look elsewhere. Two, wait it out. If you choose door two, don't be surprised to find the tiger behind it in the form of a statement to the effect, "Oh we have a better offer now, too bad. Goodbye."

What you can also do, when presenting an offer, is to add an expiration date to your offer. While that may not really accomplish anything, it will give you an out at a time where you may want to go look elsewhere. It may not stimulate the bank to respond though. In fact, they may not even notice that your offer is no longer valid. Every situation depends on the bank's manager to move it forward and in many cases the first level manager can't make decisions anyway. Hope this clears the view but I doubt that it will clear up your position in this deal.

FYI banks are moving slow for acceptance of offers return of paperwork We do advice our client if we receive that type of notice keep looking never know when things change you have wasted time .

Hi Holly. The key to your short sale is the agent that represents the seller. This Realtor must be authorized in writing to speak on your bahalf. It is a very long process, that can take as long as 5 to 6 months. I have seen them take 8 weeks, and also 12 weeks, to get the initial response from the seller's lender that they have received your short sale package.
The seller's Realtor, must prepare a very comprehensive short sale package. My check list is enclosed:
Short Sale Checklist
All pages must have loan number, socials, and names of all borrowers
• Cover Letter to Lender
• Seller's Hardship Letter
• Authorization to Release Information for all loans signed by borrowers
• HUD- or estimated closing costs
• All letters you have received from the lenders pertaining to foreclosure
• A copy of the Notice of Default
• Residential Sale and Purchase Agreement:
• 2 most recent mortgage statements for all loans
• MLS report listing property for sale including marketing history for two years
• Public record on subject property
• 2 most recent pay stubs (if employed) for all borrowers
• Copies of Termination Letter, SSC Award Letter, Retirement Income, etc
• 2 Years of Tax Returns including W2's, 1099's, and all schedules for all borrowers
• Photos of the property
• Buyers Pre-Approval Letter
• Financial Statements
• 2 most recent bank statements for all borrowers
• Recent Pay Stubs
• CMA - Comparative Market Analysis
• Listing Agreement
• Market Conditions Information for our area
• Time and patience. It may take up to three to four months to get an approval after submission of the fully executed agreement of sale.
Sellers Hardship Letter
In order to paint the full picture to the bank of the homeowner's situation it can help to provide additional documents showing the hardship. This can include medical bills, accident reports, layoff notice, etc. I typically ask my sellers to make this at least a page long. The goal with this letter is to simply have the homeowner explain their situation to the bank. This will include key items such as job loss, medical issues, divorce, health issues, etc. If the seller is considering bankruptcy you can have them include that, however it typically doesn't scare the bank into acting faster. Don Bradbury http://www.bradburyteam.com

Hi Holly,

You should read my blog. I wrote about the short sale process. http://www.reneeporsia.com

Banks usually want everything in writing. Your Realtor should be able to get something in writing for you. In real estate every must be in writing. I wouldn't count on anything until you receive a signed agreement of sale.

Renee Porsia
Associate Broker
RE/MAX ACTION REALTY
(215) 669-0589 Direct
(215) 358-1100 Office Ask For Renee
http://www.reneeporsia.com Find out what everyone is talking about. Read Renee's latest blog.

Yes this is normal.. Short sales are a different animal, and you basically need to play by the bank's rules. Be prepared to wait, as sometimes short sales take months to complete. You have to be extremely patient. Hopefully your agent is experienced in handling short sales and can advise you throughout the process. If the process becomes too much for you to deal with then you can always withdraw the offer and look elsewhere. This is not to say that things wont be wrapped up in a timely manner (45-60 days) however all I'm saying is to plan for the worst and hope for the best

Good luck!