Lenders delay Short Sales

Monday, August 10, 2009, 2:52PM

By: John Birch

John Birch
ADDvantage Real Estate


Short sales are no fun! But understanding the process along with patients and determination will often result in a sale.
For sellers it is a chance to get out from under an unaffordable mortgage, For buyers you can typically buy a home that is in move in condition, and if qualified receive a low down payment mortgage with the sellers lender paying the closing costs. In the article below you’ll see the common problem of a slow lender response, but if you are a patient buyer, or a seller looking for a solution send me an email or give me a call and I’d be glad to discuss the process.
John Birch 727 385 6547 or john@getmoreoffers.com
NEW YORK – Aug. 10, 2009 – A February survey of 1,300 real estate agents by Campbell Communications reveals that only 23 percent of short sales close, and over 90 percent of respondents blame lenders for delaying the process.

Short sales are seen as a way to reduce foreclosures and associated costs by allowing sellers to unload their properties for less than the amount owed on the mortgage, but many of these homeowners wind up in foreclosure anyway as the prolonged waiting periods prompt buyers to walk away from their offers.

Lender delays often are the result of insufficient staffing levels, short sales experience and processing systems. The presence of second liens and home-equity lines of credit also complicate the process, because these lenders also must agree on the short sale.

Meanwhile, experts say agents who neglect to submit the necessary documents to lenders or do not inform buyers and sellers of the lengthy processing time for short sales cause delays as well.

Bank of America is among the banks looking to reduce short-sale approval times by appraising homes and setting a minimum price in advance. Moreover, the Treasury Department soon expects to provide standardized documents, lender incentives, and moving allowances to homeowners to quicken the process