Real Estate Short Sales Are Really NOT Short At All

Real estate short sales are anything but short. Believe me, it can take forever sometimes for the bank that owns the property to release its interest in it even though willing buyers are ready to close the deal. In today’s real estate market, property values are lowering to rock bottom prices and homebuyers are ready to scoop them up. But what was once a simple real estate transaction that took approximately30 days to complete has now turned into a very lengthy time process that can take as long as 90 days or longer.

Typically, a short sale is supposed to allow a homeowner, who is about to have their home foreclosed upon, the opportunity to sell their property in order to avoid ruining their credit history with a foreclosure showing on their credit report. This sounds simple, but the bureaucratic process banks implement to process short sales has several stages that they must go through before they will ever release their interest in the property.

Normally, a willing homeowner will sell their home to a bank-approved buyer who then is able to close escrow and move in to their newly acquired home. In a short sale, the homeowner, who is losing his/her home, must first get his/her bank to approve the terms of the sale before the transaction ever closes escrow. This can be difficult in today’s marker when home values are continuing to decline. Obviously, the bank that owns the home wants back all the money it is owed. But in most cases, the amount that is owed far exceeds what the house is worth in value. The bank will then assign its own appraiser to determine the current value on the house and proceed to turn the file over to a “negotiator” who will then respond to an offer made by the potential buyers. By the time the interested buyers receive any feedback on their offer their file has been bounced around at the bank several times. Sometimes short sales are really not what they appear to be and can turn into an endless nightmare with the buyers often withdrawing their offer to purchase. Makes you think why congress ever bailed out the banks, but that’s another story.