Jennifur Newell

Why does a short sale take so long?

The question of whether to short sale or allow the home to foreclose is based on your personal financial scenario.  However, those that short sale are able to stay in the home during the whole short sale process without making a payment, thus allowing them to save thousands of dollars.  Short-sales can take anywhere from 2 months up to a year or longer, this is dependent on if the buyer is willing to wait for the short sale process, many times buyers will cancel, this would start the process over again.  However, some banks are starting to get the hang of the short sale and have began swapping out the old buyer with a new buyer offer.  This would allow a much shorter turnover, and producing an approval from the sellers lender much quicker.  Normal process takes 30-45 days for a negotiator to be assigned once an offer and a full short sale package(sellers financial documents) are received.  Then an appraiser or a real estate agent from a third party will come our and appraise or do a price opinion of the home, once this is done, the sellers lender will take 1-2 weeks reviewing the file and assuring the purchase price will meet the net and the value that the investor(money backer behind the bank) will approve.  Not only does the bank have to find a value that the investor will accept, but also many loans have Mortgage Insurance, and the Insurer will also need to sign off on the offer.  This is one of the biggest reasons that short sales take so long, many parties are involved and the banks negotiators are handling hundreds of files at one time.