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Replies (7)
- Nancy Celis, "nancycelis"
- Contributions:57
Hello M, just to shed some information on Short Sales. Normally when you submit a purchase contract on a property that is being sold as a short sale, depending on the bank's procedures and guidelines to process the short sale, it can take approximately anywhere from at least 2 months to as long as 6 months, this is not set in stone. Once a complete short sale packet for the seller and the buyers purchase offer is submitted, this is when the time starts. Usually if the seller or buyer is missing information, this can delay the process. It is good practice to ensure the agent submitting the shortsale packet is not leaving anything out. At that time, the bank will let the agent know approximately how long the procedure will take providing there are no setbacks. In addition, it's good to ensure if the property has a Trustee Sale date posted, that it be postponed, this can cancel the purchase should the lender not want to postpone it.
If you have an executed contract and have opened escrow on this purchase, no other offer can be accepted while you are at this stage. Once the lender has completed it's final approval, they can either accept your offer or counter it. If you are not willing to agree to it, then yes your escrow can/will be cancelled and if there are any other backup offers that meet the lenders terms, their offer can be submitted for approval.
Shortsales are a lengthly process and if you are willing to wait it out, it's worth the wait.
Good luck.
If you have an executed contract and have opened escrow on this purchase, no other offer can be accepted while you are at this stage. Once the lender has completed it's final approval, they can either accept your offer or counter it. If you are not willing to agree to it, then yes your escrow can/will be cancelled and if there are any other backup offers that meet the lenders terms, their offer can be submitted for approval.
Shortsales are a lengthly process and if you are willing to wait it out, it's worth the wait.
Good luck.
- S. Chris Webb, "PHX AZ RE BROKER"
- Contributions:411
While 30-60 days to get a bank's approval might be a general timeline, there is no guarantee. There are a lot of factors: Has the seller been through the HAFA/HAMP program; has the sale been pre-approved; Are there 2nd liens to deal with; who is the investor; who is the servicer; which national hub is handling your area for the servicer; who is negotiating on behalf of the seller and what is their experience; what is the appraisal timeframe; will the investor approve your price, contingencies, and closing costs; will there be new short sale programs to be released while your contract is in negotiations; etc. etc.
Every sale is different, even with the same "bank" and short sale negotiator. If the listing agent is only putting in one seller-accepted offer (yours) to the bank, that is a good thing. Subsequent offers, if yours is an executed contract, should be held in backup position only should yours not be approved by the investor ("bank").
Short sales can indeed be a pain, some can take months to get lender approval. The important things as a buyer, is that you must exercise great patience, be prepared for the home to depreciate in value while waiting, and really like the home you have put an offer on. I have written a blog on short sales from the buyer's perspective (I can't post a link here because that is considered self-promotion on Zillow) but if you do some minor detective work you should be able to find it quickly. I wrote it in the hopes that it can help buyers decide if short sales are right for them.
Good luck with your home-buying experience! Hope all works out well for you.
Every sale is different, even with the same "bank" and short sale negotiator. If the listing agent is only putting in one seller-accepted offer (yours) to the bank, that is a good thing. Subsequent offers, if yours is an executed contract, should be held in backup position only should yours not be approved by the investor ("bank").
Short sales can indeed be a pain, some can take months to get lender approval. The important things as a buyer, is that you must exercise great patience, be prepared for the home to depreciate in value while waiting, and really like the home you have put an offer on. I have written a blog on short sales from the buyer's perspective (I can't post a link here because that is considered self-promotion on Zillow) but if you do some minor detective work you should be able to find it quickly. I wrote it in the hopes that it can help buyers decide if short sales are right for them.
Good luck with your home-buying experience! Hope all works out well for you.
- Pacita Dimacali
- Contributions:1254
Yes, short sales can be a real pain. But for the patient buyer, the rewards could be great especially if your offer is accepted and approved by the lender, and it's significantly less than what you would have paid had this property been sold as regular sale.
The waiting period really depends on who the short sale lender is, and how many loans and liens there are.
Wachovia is the best one to deal with, and probably has the shortest waiting period.
I represent a buyer on a $1M purchase of a short sale in Oakland --- the lender is Chase. It's been 60 days, and still no response.
I have 2 short sales with Bank of America. On one of them, the buyers walked because BOA took so long to respond. I have had to resort to tweeting on BOA's twitter account to get some help. Waiting for nearly 3 months on one of them.
I also have close Wells Fargo short sales --- also took a long time, but at least I was dealing "live" with the negotiators. Now that they're also going to use Equator system that is being used by BOA, I dread the distance created by going through an automated process versus talking with a live human being.
Good luck.....keep your eye on your ultimate goal: getting a good home at a good deal. Just be patient.
The waiting period really depends on who the short sale lender is, and how many loans and liens there are.
Wachovia is the best one to deal with, and probably has the shortest waiting period.
I represent a buyer on a $1M purchase of a short sale in Oakland --- the lender is Chase. It's been 60 days, and still no response.
I have 2 short sales with Bank of America. On one of them, the buyers walked because BOA took so long to respond. I have had to resort to tweeting on BOA's twitter account to get some help. Waiting for nearly 3 months on one of them.
I also have close Wells Fargo short sales --- also took a long time, but at least I was dealing "live" with the negotiators. Now that they're also going to use Equator system that is being used by BOA, I dread the distance created by going through an automated process versus talking with a live human being.
Good luck.....keep your eye on your ultimate goal: getting a good home at a good deal. Just be patient.
- Thomas Gonzalez, GRI, CRS,, "Bink Realty LLC"
- Contributions:203
Length of time for short sale approval can very depending on a varity of factors including bank policies, amount owed to fair market value, investment vs. primary property, cooperation of seller with the bank, agents communication with the bank(s). Although, the agent involved with the short sale usually know whats going on and may not tell the complete story with the buyer in that the buyer may walk away feeling the process amy be too long and the agent might be getting 2nd or 3rd generation information. The more complicated the short sale and the less cooperative from parties typically ends up taking longer to process if not at all.
- marianne80
- Contributions:34
I greatly appreciate all these replies, thank you all SO much.
One thing I know is that while speaking with the realtor we've been working with, they said the previous owners have an attorney and that it is "helpful." Is this true? The realtor I spoke with said it makes the process easier and that they know this attorney... and that they do nothing but short sales... But again, I am someone that does not know much about this especially as a first time home buyer. I'm curious if that information about them having an attorney is in fact helpful in the process or not. I think above all I understand the whole process "takes as long as it takes".
And also, it was suggested to us that we do a home inspection on the house now rather than after (and if) our offer is accepted by the bank. I know for us, we'd know sooner than later if there was any major unseen problem with the house. But I am not clear on why else we should consider doing the inspection now opposed to later. We have the appointment all set and can cancel up to tomorrow afternoon. We are still deciding whether or not to keep that date. I got the impression it would be helpful in moving things along after the point of getting approval from the bank, but MUST we do it now, or can we wait until (and if) approved without consequence?
One thing I know is that while speaking with the realtor we've been working with, they said the previous owners have an attorney and that it is "helpful." Is this true? The realtor I spoke with said it makes the process easier and that they know this attorney... and that they do nothing but short sales... But again, I am someone that does not know much about this especially as a first time home buyer. I'm curious if that information about them having an attorney is in fact helpful in the process or not. I think above all I understand the whole process "takes as long as it takes".
And also, it was suggested to us that we do a home inspection on the house now rather than after (and if) our offer is accepted by the bank. I know for us, we'd know sooner than later if there was any major unseen problem with the house. But I am not clear on why else we should consider doing the inspection now opposed to later. We have the appointment all set and can cancel up to tomorrow afternoon. We are still deciding whether or not to keep that date. I got the impression it would be helpful in moving things along after the point of getting approval from the bank, but MUST we do it now, or can we wait until (and if) approved without consequence?
- Joe Vickers, "Joe Vickers"
- Contributions:462
Check with your Agent to be sure when the clock starts ticking on your inspection period. If it is the date the 3rd party (bank) approves you can wait. I have had clients do their inspections immediately for the reasons you mentioned. Keep in mind that the condition of the home can change while you are waiting for the approval.
- S. Chris Webb, "PHX AZ RE BROKER"
- Contributions:411
"I'm curious if that information about them having an attorney is in fact helpful in the process or not."
I always have prospective S.S. sellers get advice from an accountant and attorney to see if a S.S. is their best option. However, a lawyer negotiating the sale may be just another "hand in the pocket". An experienced, educated, short sale real estate agent/negotiator working closely with the escrow officer is really all that's necessary to handle negotiations with the bank. It's not for every agent out there, though. Agents not familiar with the process are a lot less likely to be successful. In their case hiring an attorney may be the best route for them. It also indemnifies them from a lot of legal matters that they really shouldn't be handling. If there are multiple liens on the property, especially judgments or mechanics' liens, an attorney should be at the seller's side all the way. A real estate agent is in no position to give legal advice.
"And also, it was suggested to us that we do a home inspection on the house now rather than after (and if) our offer is accepted by the bank."
To be safe, you may want to do two inspections. One now so you don't waste your time waiting on a house that has a material defect you can't live with, and one during the inspection period (or whatever they call it in your state) that should be AFTER lender approval. A LOT can happen to a home in between! For example, on a short sale I was handling last year, thieves came in and stole some of the outside fixtures. The seller was not in a financial position to replace it. I also had a listing where the kitchen appliances were stolen. Another where the HVAC condensation lines leaked, damaging the ceiling. Remember, you are taking the house AS-IS in most short sale cases. You do not have to do an inspection now, unless it was in your contract the the inspection period is now. Refer to your contract.
I always have prospective S.S. sellers get advice from an accountant and attorney to see if a S.S. is their best option. However, a lawyer negotiating the sale may be just another "hand in the pocket". An experienced, educated, short sale real estate agent/negotiator working closely with the escrow officer is really all that's necessary to handle negotiations with the bank. It's not for every agent out there, though. Agents not familiar with the process are a lot less likely to be successful. In their case hiring an attorney may be the best route for them. It also indemnifies them from a lot of legal matters that they really shouldn't be handling. If there are multiple liens on the property, especially judgments or mechanics' liens, an attorney should be at the seller's side all the way. A real estate agent is in no position to give legal advice.
"And also, it was suggested to us that we do a home inspection on the house now rather than after (and if) our offer is accepted by the bank."
To be safe, you may want to do two inspections. One now so you don't waste your time waiting on a house that has a material defect you can't live with, and one during the inspection period (or whatever they call it in your state) that should be AFTER lender approval. A LOT can happen to a home in between! For example, on a short sale I was handling last year, thieves came in and stole some of the outside fixtures. The seller was not in a financial position to replace it. I also had a listing where the kitchen appliances were stolen. Another where the HVAC condensation lines leaked, damaging the ceiling. Remember, you are taking the house AS-IS in most short sale cases. You do not have to do an inspection now, unless it was in your contract the the inspection period is now. Refer to your contract.
Short sale buy question-- will it really only take a couple months to find out if we were accepted?
Two realtors working with us said we would find out in 30-60 days... maybe even 45.
I have realtor relatives from out of state that lived here for decades. They said its ok to believe the realtors about the time frame because they are getting that time frame from knowing the bank that is doing the accepting (or the not accepting!) Not getting it FROM the bank, but from experience with whatever bank it is. Does this sound correct?
Can we rely on this? Also, how likely is it that many others will put offers in? Short sales seem to be a real pain... are not many people willing to deal with this? There was only one other offer put in, and it was a super low-ball that it was never submitted to the bank. Only ours has been.
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