Monday, March 31, 2008

Short Sales: Time Frame and Approval Process

I get phone calls almost daily from agents in my market asking how long the short sale lender will take to respond, if they have approved the price, and how "far along" in the process the short sale is. Here are the answers:

1. How long will the lender take? Use a 90 day closing in your contract- for starters. Depending on the lender backlog, your closing may take as long as four months, if approved. The last closing I had with ASC, for example, was submitted as a complete package on December 7, 2007. It closed on March 27, 2008. That is almost four months. Currently, most lenders are taking 30 (if you are lucky) to 75 days to order an appraisal on the property.

2. Has the lender approved the price? It depends on the lender. Many of the bigger lenders do not pre-approve a price, for example-- Countrywide, Wells Fargo, Chase, Aurora, etc. However, a few do-- Citi Residential, Fremont. So, most of the time, the answer is "no", the list price is not "pre-approved". Most lenders will look at the price at the time an offer is submitted, and order an appraisal or BPO (Broker Price Opinion) at that time.

3. How far along is property in the short sale process? See number 2, above. Most lenders take no action on the file until a complete short sale package, with offer, is submitted. Yes, Citi Residential and Fremont are ahead of the game, but if there is a second mortgage involved, add that to your scenario.

It's Wendy!
Wendy Rulnick, Broker, CRP, CRS, GRI, ABR Rulnick Realty, Inc.
Specializing in SHORT SALES and FORECLOSURES on the Emerald Coast of Florida: Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.
Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or 850-650-7883 ext 204

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