Profile picture for buyerinneed

Waiting on a bid on short sale home.

We are still waiting on closing on a short sale home since 12/09. The owners have agreed & signed since 1/10 and it says pending on the web site. Our realtor says the house is ours and the sale is just pending the bank (who hasn't signed yet). I've been told you need to patient with short sales (& it isn't easy!), but I've also read that the bank can also still say "no" and go to foreclosure. We've looked at other houses - but we favor this one. Are we foolish to keep waiting and should we think about putting a bid on another house (NOT a short sale)? Thank you. KTR
  • April 28 2010 - Pontiac
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Answers (8)

Your Realtor is correct... some can take 6.7.10 months to get through the shorted bank... Good luck...
  • April 29 2010
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Short Sales typically take 3-6 months to complete but they can take longer. There are a couple things you can do now to find out where you stand. (These questions should be asked prior to writing an offer on a short sale) First, ask your agent to find out how many short sales the listing agent has completed recently. See how many loans are on the property and who the lenders are. An often missed detail is to make sure the sellers actually have a hardship and qualify for a short sale. Find out if there has been a BPO (Brokers Price Opinion) ordered or completed yet. Is the price you are in escrow at a reasonable price: if the loan is a Fannie Mae loan are you at least 90% of FMV or Fair Market Value. Have your agent try to determine if the loan or loans on the home have any type of mortgage insurance attached to them because this can cause problems getting a short sale approved. Is the agent  working for you well aquainted with the short sale process?  Calling the listing agent 2 times a week to get updates will not help, the short sale process takes some time even when it is all going well. There are obviously more questions that can be asked but in general, if the listing agent has been successful closing short sales that is a good sign. I would call today though and see if they have had the BPO ordered or completed yet.
  • April 29 2010
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If the listing agent and/or the seller is not putting enough pressure on the bank, i.e. calling daily, making sure they have all required documentation the process can go on for quite some time. A buyer in my office just closed on a house that they had been waiting on for over a year. So it is up to you, but my advice would be to keep looking. Nothing is worse than having your heart set on something to find out after 8 months of waiting that you cannot have it after all.
  • April 29 2010
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If short sale was already approved by the bank they will not say no. Be patient (if you are getting a good deal). It took my 6 months to close a short sale.
  • April 29 2010
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Don't bank too much on the assurance of your Realtor at this point Murphy's Law still applies in a big way.  Not to make you nervous, but the buyers are largely in the dark when it comes to short sales and it's always good to get as much information as possible directly from the listing agent or short sale management firm (whichever is managing the short sale) as they are the gate keepers to the progress of the deal.

Some things to have your agent ask the listing agent to determine the progress of your offer:

Has the Internal BPO been ordered?  Has it been completed?  If yes - you're well on your way.
Has the seller submitted a COMPLETED short sale packet?
Has the foreclosure date been postponed?
Are there any liens other than the 1st mortgage? If so, have the been settled?
Most importantly: What is left to be done before the bank signs off?

Make sure your agent is calling the listing side every other day at the least!

Saw a couple GREAT short sale articles on TheChicago77.com

One was on Multi-offer strategy in a Short Sale situation, you should check it out:
http://www.thechicago77.com/2010/04/short-sale-and-foreclosure-multi-offer-strategy/

And another Great one on the Short Sale process from the seller's side which will educate you on the things you should be asking of the seller:
www.thechicago77.com/2010/02/the-short-sale-process-part-1-how-to-hit-a-bulls-eye-while-blind-folded/

If you have the time, it never hurts to keep looking if you're not getting answers.  A tight lipped listing agent generally means they are inexperienced and/or problems with the file.  If things are running smoothly they should be forthcoming with the progress of the loan.

Best of luck!
Dreamtown.com
  • April 29 2010
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I always tell my buyers to keep looking.  It is very possible that your short sale can fall apart.  The seller can become uncooperative with the bank, there may be multiple mortgages, the 2nd mortgage company can say no.  There are so many variables.  To say the house is yours?......It's not a done deal until the banks say so.  Just don't get hung up on the one house and keep looking  
  • April 29 2010
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Perhaps there are other lien holders that the principal lender (bank) has to negotiate with. Tax liens (State & Federal), can be very difficult to deal with. Sometimes the only way to make those liens disappear is with a Sheriff's sale (foreclosure).

If there are no second mortgages, home equity loans, tax liens or mechanics liens, I can't think of any other reasons for the property not to close. Unless the bank is waiting for a better offer. Ask your agent to check for other liens on the property. This might involve a title search and a few hundred dollars.

Good luck KTR, I hope you get the home!
  • April 28 2010
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Profile picture for Dan Tabit
Buyer,
I'm finally closing one this week that has been in play since August 2009.  There is nothing "short" about a short sale.  Some lenders are better than others,but your time so far is not unusual or even long. 
I tell my buyers to keep their eyes open to consider other properties, just not other short sales. 
There are no guarentees, so hang in there, hope for the best and consider other alternatives. 
  • April 28 2010
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