The issue is that all Short-sales behave different, because it depends on:
A. Which bank or banks holds the mortgage
B. How many mortgages (or banks) in the property.
C. Is the owner cooperating and maintaining the required paperwork up to date.
D. Is the SS processor maintaining paperwork trail up to date.
E. Is the buyer willing to patiently wait, even when they are not getting any news or updates for several months.
I have seen SS close in 30 days (when someone else did the waiting and walked away, then the bank issued a closing acceptance and a new buyer stepped in).
I have seen SS close in 90 days....when all worked as it should.
I have seen some go over 9 months and the bank forecloses on the home before finishing the SS negotiations, leaving everyone hanging. And of course have seen many that never closed.
SSales are good for investors who have no "set date" when they must have the keys to the home, and can walk away un-hurt after a few months of waiting. But that is not usually the case with residential buyers. It all comes down to "if you have 50% chances, will you buy. What about 25%". Was this answer helpful? If so please click on the "green thumbs up" or the "best answer".
La Rosa Realty
I agree with Steve (mortgages). Here's the deal. The banks have agreed to offer help such as short sales and modifications as part of various settlements for criminal activities such as robosigning, predatory loans etc. You can look through the MLS and find numerous cases of properties listed as a short sale say for $200K that never sell and then months later, it's listed for $140K and is owned by the bank. Those numbers are just examples but the point is the bank forecloses and sells the home for significantly less than they would have gotten as a short sale. Makes absolutely no sense huh? Wrong.
A large majority of loans are insured . The lenders can't collect on the insurance if they sell it as a short sale. They can however collect the full amount of the mortgage along with interest and all expenses up to the insured amount if they foreclose. Then they also get the home and can sell it for even more profit. Now the question is, knowing this, "would you do a short sale on a home if you could make more money by foreclosing on it?". Ok, you are human and maybe a nice person but the banks, in spite of the mandates and legal agreements have no conscious and no desire to help anybody but themselves and the government doesn't stop them. In fact, just the opposite. Legislators want to use the fines that the banks paid to pass laws to allow the banks to foreclose without due process. There are 2 bills in Florida right now that use the "fine" money to employ retired, unlicensed judges to "streamline" foreclosures. It's a mess and it's all about who's paying for their campaigns. It's very easy to "follow the buck" and see who's sponsoring these bills and who's voting for them.
This is why so many homeowners are being foreclosed on, even when they beg to modify their loan or sell at a short sale and then don't "qualify". To top it all off, the big banks generally don't put out a dime of their own money. They use OPM or create it out of thin air. Greed at it's very finest.
So the answer to your question is, the percentage of short sales is the percentage of mortgages that the bank can make the most money on. Problem is as you sit and wait tied up in contract, you can miss other "real" deals and the seller sits and thinks he's not going to be foreclosed on. I know someone that actually waited 2 years for a short sale and the home was worth less than what they were in contract for. "Somehow" the bank had to come up with a second appraisal so that she could get financed. I might add that it was not my client as I would have never allowed them to buy it but they did. Every now and then, we'll see one go through. If someone says they are seeing 30%, then you can bet 30% is the approximate amount on the market that aren't insured.
In the greater Tampa Bay area, short sales and other distressed sales are a consistent percentage of total sales. It is important to note what Brian stated. "All short sales eventually sale."
According to area staistics less that 30% of initial short sale offers close. That means more that 70% of the time the first buyer making an offer on a short sale is play for the LOSING team.
Understanding the process, trusting your team, sticking with the right strategy can lead to success.
EVERY SINGLE SHORT SALE IS DIFFERENT!
In this highly complex transaction, you must have patience determination, faith, infimante patience and understand, when one closes in a MIRACLE!
The down side is they take an eternity to matierialize.
Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
Move on and stop chasing these Clown Car Full of Horrors Short Sales that don't close! All that time you were waiting on that property, the other homes have gone up in price!
Find a good Foreclosure or Re-sale that can close...and close asap!
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