Like my colleagues have stated each bank is different in their response time and each loan has a different investor behind that loan that will have different criteria that they will allow. I have 2 GMAC short sale listings that I am doing right now that I submitted the same day on December 23rd with a full financial package and offers. One was accepted and closes next week while the other is still in negotiation and probably wont close til the end of March. Why you may ask? Different investors behind the loans. Here is how the basics break down:
If it is a VA loan that is being short sold they will accept up to 88% net of the BPO value. (A mini appraisal)
FHA minimum net proceeds also include Length of Time From Date of Approval:
- Less than 30 days = 88% 30-60 days = 86% 61+ days = 84%.
Conventional is typically up to 81% ("Up to" is the optional phrase here)
So, the net proceeds that the lender needs to receive at closing MUST be no less than the percentages listed above of the BPO value, which is referenced on the HUD. This means that you MUST ensure that everything in the transaction that will be paid (i.e. Realtor commissions, closing costs, liens, judgments, seller incentives, prorated taxed, etc.) has to be accounted for before reaching the appropriate threshold.
The other factor is the BPO value. Have your Realtor do their own BPO and pull the type of loan it is on the MLS. We have it hear in Virginia Beach on Real List so I don't know if your Realtor has access to that info...if not then tell him to ask the listing agent what type of loan it is. Once you have that info you will have a pretty good indication of what they will accept based on the thresholds above, but then your type of loan will have an impact as well. For example Fannie Mae usually wont pay closing costs if the purchaser is getting a conventional loan. Don't know why...just what they do. FHA to FHA will only pay 1%. 99 out of 100 times the banks will counter unless you are at their BPO value with your current offer. Unfortunately a lot of agents will list their properties at ridiculously low prices in order to get an offer...it's really just throwing mud on the wall.
Bottom line there is a lot of mitigating factors in the process. I do a tremendous amount of short sales and have never had one that was the same. I've closed one in 32 days and I have worked one for 9 months. I will say this...it is trending to become easier because now asset managers are getting involved in loss mitigation and are involving me in the pricing of the property. Hope this helps and let me know if I can be of assistance. My website also has good info to read. Speaking of which I need to update it with the latest info!