There appears to be no end in sight to the collateral damage that the subprime mortgage meltdown has caused.  Many property owners who find themselves "upside down" (the fair market value of their property is less than the mortgage debt) are attempting to obtain lender approval of short sales. However, the foreclosure filings keep growing. Are lenders really cooperating in approving short sales? Is there more publicity about short sales - than actual closings of short sales?

I have asked several real estate attorneys and realtors what their experience has been with short sale approval. One attorney has been waiting four months for an answer from the largest national lender. A realtor in South Florida has been having an 80% success rate with short sales submissions - but it has taken up to 11 months to obtain some approvals! I recently had a short sale transaction fall apart because the buyer walked away due to the uncertain timeframe in obtaining lender approval.

Bottom line: there is no guarantee that a short sale will receive the lender's approval in a timeframe that will keep the proposed sale on track. However, it still is an important strategy that should be pursued (with appropriate protections for all parties) when a property owner is "upside down" and there is a ready, willing and able buyer.