Home Buying in Studio City>Question Details

Jessica, Home Buyer in Los Angeles, CA

Short Sales

Asked by Jessica, Los Angeles, CA Tue Sep 30, 2008

Hello,

I was wondering how long a short sale usually takes. Is there anything the buyer can do to speed up the process? Any info on short sales will be much appreciated.

thank you!!

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7
Keith Sorem’s answer
Jessica, you have some great posts here, I particularly like the hints Bandele offers.
You should know that there is big difference between lenders and the types of loans on the property. I would make sure that your Realtor asks the listing agent if the sale has been approved. Some listings go on the market as "short sales" but in fact the lender has not approved anything.

Many lenders will not start the process until they have an offer. A listing that has an offer is likely to be farther along in the process, so some listings that list the status as " back up offers" might yield a shorter wait.

Good luck!
1 vote Thank Flag Link Tue Sep 30, 2008
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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Hello Jessica:

While it is true that short sales are slower to close than regular sales, there are a few things that the buyers can do to either speed up the process or stay on top of the stake holders 9the seller, the seller's agent, and the seller's lenders). 1st, ask if the seller has 1 or 2 loans against the property and if both loans are being serviced by the same lender. If there is only one loan or if both loans are owned or being serviced by the same lender, then there is a greater chance of closing your transactions faster. 2nd, find out the total debt owed against the property - many times a property is listed so much less than it is worth and at a price that is a ridiculous fraction of the outstanding debt in order to generate interest. The seller's lenders will not agree to just give away the property at a ridiculous price. The seller's lender is going to want to recoup as much of the debt as possible and as close to the "true market value" as possible. Thus, try to bid close to a "fair market value" so that your offer will be seriously considered by the seller's lender(s). 3rd, when you write your offer, make sure to include a Short Sale Addendum that specifies that you, the buyer, is giving the seller no more than 30 days to get seller's lenders to approve the short sale and provide you, the buyer, with written confirmation of the approval of the short sale. 4th, make sure your real estate representative follows-up by email or phone call with the listing agent/seller's agent at least once per week. 5th, make sure your representative stays on top of the seller's agent to ensure seller's agent has timely provided all documentation required/requested by the seller's lenders such as financial statements, hardship letters, pay-stubs, tax returns, etc. Sometimes, the seller has not timely provided everything that is being requested to justify the shortsale or the seller is providing the documentation is drips and drab. This would definitely delay a final approval from the sellers lenders. 6th, have your agent ask the seller's agent if the seller's lender had sent an appraiser to value the property - if this has been done, it is a sign that things are moving along. Lastly, there is so much more to getting your shortsale transaction closed in the least amount of time; so feel free to call me at 818-825-6996 or visit my website at http://www.BogunEnterprises.com.
1 vote Thank Flag Link Tue Sep 30, 2008
Hi Jessica,

I think that short sales, as a whole, are handled wrong. Many agents send off every offer to the bank as if they already own the home. They don't, yet. The bank's position is to approve a settlement of the debt, they have approval power. So what I do is tell the listing agent that we will give them a good offer, and open escrow and then wait for bank approval. We put a small deposit into escrow and incur no fees. Then we wait. I also try and get them to use my escrow officer who is a short sale expert and she has been averaging 45 days, start to finish. This way, we are the only offer the bank sees, unless they ask for others, and they see they have a qualified buyer who is in escrow. Makes it easy for them to say "yes."

Hope this helps....if you aren't in escrow, then throw offers out and hope that they come back sometime. Sometimes they do, other buyers might find something else and you'll end up getting it.

I have more information on my website page....see below.

Karen
0 votes Thank Flag Link Mon Jan 19, 2009
Hi Jessica,

A short sale can close as little as a few weeks and can take up to 4 months to close. Please work with a short sale specialist who knows what they are doing.

You should continue to make offers on other properties until a short sale has been accepted by the bank.
If you are looking to purchase a short sale home here in the San Fernando Valley, visit: http://www.shortsales.la

Richard Johnston, Rodeo Realty
Short Sale Specialist
http://www.estates.la
0 votes Thank Flag Link Mon Jan 19, 2009
Jessica short sales are ranging from 90-180 days, depending on the bank and the caseload of the loss mitigator. There is nothing you can do or the agents can do to speed up the process, its all up to the bank. Be patient, if the bank is working with the agent, its a good sign.

Good Luck!
0 votes Thank Flag Link Tue Sep 30, 2008
Short sales are taking about 2 months to get through. It is a waiting game. Each one is dealing with 200 to 300 files at a time. When it comes down to the end they will want to close in a hurry. So be ready to go. It is hard on the buyers lenders because they will want to close sometimes in a few weeks. Have your lender working on it now. I know with the market the way it is buyers lenders are not sure where they will be able to get your loan. You are not able to do anything to speed this up. Most of the companies don't even have a way to talk with them. They can only call out. A package goes to this lender with the sellers info and your loan approval so the lender knows you will be able to get the loan. They have a appraisal done on the property to make sure your offer is in the ball park. They are checking to see if they are able to get more money for the property from an other offer or by letting it go to foreclosure. At the end they will come back with either a counter offer or terms to close. Some of the lenders want a letter stating why you made this offer. Say repairs are need on this property and you have offered this considering that repairs need to be made. Good luck and hope all goes well.
0 votes Thank Flag Link Tue Sep 30, 2008
No with any short sale or foreclosure banks are extremely slow and busy. It not the fault of either listing or buyers agent. Patient however if bank has not approved your offer, I would keep looking property may have bidding war.
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0 votes Thank Flag Link Tue Sep 30, 2008
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