My Short Sale Summary

I finally closed one of my listings that was a short sale.  It took 2 and half months to get approval.  There were two banks involved.  One, the first position, had 80% of the loan and the other, second position, had 20%.  The second ended up receiving only $1000.  They made it difficult to get an approval.  Luckily we had some phone numbers of some higher-ups and they helped us get things done.

The second told us that they had a Broker Price Opinion that said the home was worth more than the offer we received.  Now I know sometimes files get mixed up so I hope that is the reason they were wrong but it could well have killed the deal.  A supervisor actually looked over the file and found that there hadn’t been a Price Opinion and then they ordered it.   These are some of the things that can slow up the process.

Later we learned that they were setting up a new system to streamline the process.  Another Realtor working with the same bank put in an offer weeks after me and got his approved sooner.  I think we were just stuck in the middle of that transition.

The buyer was patient to stick around that long; that is not often the case.  We had a snafu at the end which caused us to postpone the closing by a couple of days.  We almost had to ask for an extension and the bank said that they would have to get more money if there was another extension.  Really?  Does that even make sense?  The other bank wasn’t going to give any more money to the second and my client didn’t have any money.  Would they risk the deal not closing?  Luckily I don’t have the answer to that because we closed in time.

It was a bunch of hurry up and wait.  The banks are overwhelmed right now and there is no leverage on our side.  The one person processing the file cannot be pushed. They sit in a cubicle making these decisions and you could easily be put to the bottom or have your file “lost”.  They get paid either way.

I have two other listings right now that are short sales and I expect to have a lot more by the end of the year unfortunately for them.  Hopefully the process goes faster and hopefully more buyers come out.  I am hearing more and more investors coming into the market but time will tell.