Stages of a short sale

Asked by ALaur, Clinton Township, MI Fri Apr 5, 2013

Looking for some insight with our short sale . We put in our offer back at the end of August and it was accepted by the seller in early September. Since then we've been on a roller coaster of ups and downs. To cut to the chase, after a three week delay the main mortgage company (two loans on the house) has gotten the BPO back and the file has gone to the "solution stage." Any idea of how close we are to finally getting some type of response back from the bank? We've been living with relatives since July and are patiently awaiting our house. Any insight would be aweome.

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5
Haig Istambo…, Agent, Rochester, MI
Fri Apr 5, 2013
Hello,

I think I can speak for many Realtors that are involved with Short Sales when I say this must be the number question I get EVERY day. Usually the question starts.. "Can you check on the status of my Short Sale?" or "how much longer do you think it will take?"

Boy if only we had the answers, it would allevaite so much stress and wasted time for everyone involved. The answer to your question is NO ONE KNOWS, not the Listing Agent, not the Selling Agent and usually NOT most of the people involved negotiating the Short Sale. Until you near "the end", there is NO set time frame for a Short Sale, nor will you get many helpful answers.

I have been doing them on a daily basis for about 4 years and all I can tell you is I had one take 2 weeks (absolute miracle) and I am currently involved with my longest one at a year and 2 months. Every Short Sale is different, every lender is different, every negotiator is different, so there isn't a clear cut answer on the length of time it should take.

Banks are overwhelmed, understaffed and some lenders really don't care if the property goes to foreclosure, they actually make more money on most foreclosures in the long run (versus short selling the home).Just because the seller signed your offer, it almost means nothing to be honest, only that the Short Sale process has started.

The lender is the one that is going to make the decision and all your file did, when the owner of the property signed it, was get in line behind thousands of other short sales at any given lender. By the time your file sees human eyes it could easily be 3 - 6 months. Once someone looks at your file all that guarantees is that someone is going to follow up on the file, it does NOT mean they will accept the offer.

Many things can still happen; the bank can reject the offer, the bank can counter your offer (very common now since property values are rising), the bank can accept your offer if the owner of the home makes a "contribution". Nothing says you are guaranteed to get the property so I would have a plan "B" if I were you.

Believe me when I tell you, it is definitely frustrating for you, and extremely frustrating for both agents who are counted on to give "updates" on the status of the Short Sale. Imagine getting a text, an email and/or a call from a dozen or so clients that you have an "accepted" short sale offer for, every day or every few days. It increases our workload, increases everyone's frustrations and wastes a lot of everyone's time.

All you can do at this point is wait, eventually there will be an end in one direction or another. But as I said, have a back-up plan ready because you just never know what the decision will be.

I know that is not what you want to hear, but it is the absolute truth when it comes to short sales, no one has a definitive answer.

Thank you and Good Luck!

HAIG
(248) 379-6547
realtorhaig@aol.com
1 vote
Thanks.
Flag Wed May 15, 2013
Curly Sue, , Texas
Fri Apr 5, 2013
I would say you'll be celebrating the 4th of July with your relatives. There's nothing short about a short sale!
0 votes
Kathy Persha, Agent, Birmingham, MI
Fri Apr 5, 2013
Unfortunately, there is no insight that can be given to you. I have short sales that have gone for a year without an answer and others that have gone 6-9 months and the lender came back and refused to approve the short sale because it meant more money to them to foreclose on the property. Just because he seller accepted your offer does not mean that the lender will approve it. These are just the cold hard facts when dealing with a short sale.

Kathy Persha, Broker
GRI, CDPE, SFR, CIAS
Nextage Advanced Realty
0 votes
Karen Paytas, Agent, Clinton Twp, MI
Fri Apr 5, 2013
Unfortunately, no one can guess when the bank will respond. Hopefully, the agent has gotten somewhere with the 2nd lien holder? I was just informed by an asset manager on one of my short sales that the more we call and ask for a status the more likely we'll get an answer quicker. Who knows??/

Good Luck,

Karen Paytas, GRI, CMS
Realtor
Real Living Kee Realty
586-709-8465
kpaytas@mirealsource.com
0 votes
Gary and Kar…, Agent, Boca Raton, FL
Fri Apr 5, 2013
Unfortunately - This is a very precarious position -

Just because you are under the contract - Is not a guarantee of acquisition.

There are many potential pitfalls in this type of transaction -

These should be examined on a case by case basis...
Web Reference:  http://www.garyyoungman.com
0 votes
Oh I fully understand that. I just want some type finality of answer to where we stand. We've literally been told since November that they'll "have a decision in 2-3 weeks" and we're still waiting. We've been actively pursuing other properties and putting in offers but the market has turned and places are going super fast and we haven't been able to secure anything as of yet.
Flag Fri Apr 5, 2013
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