Alex, any way you cut it there is nothing short about a short sale! They take a long time. I know it is frustrating to you as the buyer. Trust me. It is frustrating to us as agents as well. Our hands are tied. The banks are not prepared to handle all of the files that they currently have due to the high number of sellers in this situation. I understand that loss mitagators get paid hourly. I wish they got paid commission...that way they would put more care into what we are trying to accomplish.
Here in West Michigan we put warnings on these listings. I always warn buyers up front that it could be 6 - 10 weeks for the banks to decide if they want to do a short sale or not. Then the bank may not even want to do it, they may counter you, accept your offer and/or accept another higher offer. Last year I worked on one where I got an offer July 2nd and we closed the day before Thanksgiving. They are very time consuming.
Be prepared though because once the bank decides they will accept a short sale, they will want you to close like yesterday. Then they start pushing like crazy to get the deal done, but it will take a lot to jump start them.
If you are in love with the house and willing to wait...hang in there, you might be 1/2 way to an answer. If it isn't everything you hoped for you may want to consider another "alternative" as another agent said. Everyday good properties are being sold from underneath you because you are waiting for a bank that has lack of customer service skills.
On the other hand I feel so bad for the sellers who are trying to get a short sale on their credit report instead of the dreaded "foreclosure." But these banks refuse to make it easy on anybody in the transaction. They work on their time...nobody else's. Let's face it...they really do not want these properties back, but like to make everybody's life difficult in the process. I feel that they are really harming the sellers as well when the seller is willing to assist in getting the property sold. Then I find some buyers are waiting for properties to go into foreclosure so they can get quicker answers. I just recently wrote on a foreclosure and had an accepted offer in 1 hour! Sure does beat several weeks!
It used to be that banks would respond on foreclosures in 4-5 days. Now you almost always have an answer in 2 days...or at least in my experience. I think that the short sale process at the banks need to step up the scale like they have done with the shorter response times on the foreclosures.
It is a gamble if you wait to see if it goes into foreclosure because if you do that then perhaps someone else maybe willing to wait. Not to mention if the banks price them low enough you may be up against competing offers and still wait months to get it as the bank secures the property and can legally get it back on the market.
There is no good scenario when it comes to buying a short sale. Again, my advice is wait if you love it, or if you can live with out it...find something else. (of course if you can within the guidelines of your contract...check with your buyers agent on this.)
I hope this information helps! Best Wishes! (I hope this does not sound too negative.)