Home sellers are as frustrated as Realtors when the deal involves a short sale, as most home sales do these days. A recent survey revealed that only 23% of short sale contracts actually get to close. Although buyers come pre approved for financing and prices are market value, a host of problems still plague the short sale process. Rapidly falling appraised values due to neighborhood foreclosures combined with the snail like pace of lenders processing short sale packages are the heart of the problem (in my opinion).
Delays by lenders allow impatient buyers to walk away while values deteriorate to a lesser price than contracted for. A more efficient system may in fact reduce pending sale times with a more workable window and help to hold sales together. Short sales, after all should be seen as a way to prevent foreclosures and related costs to lenders. It's frustrating that with a way to avoid those costs many wind up in foreclosure anyway as a result of prolonged waiting periods. many lender delays are a result of insufficient staff and a lack of short sale experience and processing systems. Delays may also occur as a result of Realtor inexperience in submitting documents or informing buyers and sellers of the length of time involved.
Some lenders are considering or at least examining ways to shorten the process and short sale approval time by getting BPO's (appraisals) and setting bottom line prices in advance of a contract. Ideally this lets a seller and realtor offer a property for a price that has already been accepted by the lender. The Treasury Dept. expects to provide lenders with a standard set of documents as well along with added incentives to help move the process along. Both steps in the right direction and an inevitable step in the evolution of home selling. More and more short sales are becoming the standard for home selling. The need for expeditious systems is now.
If you're trying to sell or buy a home please call 561-306-6736 or email me for more valuable information. Go to GES Realty.com for any real estate searches
RE/MAX CROSSROADS - Ocean City, MD
Serving Ocean City, MD, & The Delaware Beaches
Fulmer Realty- Floresville, LaVernia, San Antonio - San Antonio, TX
Broadpoint Properties - Escondido, CA
Broker, Escondido Real Estate, San Diego County
Obama's package actually already has incentives in play. Yet the banks do not know how to pass them on the borrowers who are selling their homes in short sale. I think that, to a degree, because of the sheer numbers of folks facing foreclosure, it is a logisitical nightmare for the banks.
Aug 11, 2009 03:44 AM
Eagle Realty - North Myrtle Beach, SC
North Myrtle Beach Coastal Carolinas
23% is about double that at the beach. Fewer agents are willing to show short listings every day. You mentioned frustrated sellers- buyers are just as frustrated and Realtors pull their hair out through out a usually doomed process.
Aug 11, 2009 03:44 AM
Century 21 All-Stars - Downey, CA
Yea, I prepared my borrower. Told him we were in it for the long haul. So far so good. I guess it helps a bit when the buyer really wants the home too.
Aug 11, 2009 03:57 AM
Resident Realty - Fort Collins, CO
I'm not sure the banks have any excuses any longer. With all of the short sales, and many more to come, there's no excuse for the incompetence of the banks processing of them.
Aug 11, 2009 04:04 AM
Benjamin Realty LLC - Gold Canyon, AZ
East Phoenix Arizona Homes
Short sales are anything BUT short -- and they require patience on the part of all parties.
Aug 11, 2009 04:55 AM
Comments(7)