September 26th, 2009 7:46 AM by Lehel Szucs
There is a lot of misinformation regarding how long it takes (on average) to negotiate a short sale with a lender. As a full-time real estate consultant who negotiates directly with lenders to buy the houses of people who find themselves in the process of being foreclosed upon, I know exactly how long it takes -- and it isn't quick.
I've heard all manner of nonsense from so called "short sale experts" who say that 60-90 days is a realistic timeframe -- ridiculous! While such quick negotiations do happen from time to time (just like some people do actually win the mega-lotto) the typical negotiation is much, much, much longer.
I think that it's VERY important to be honest with the homeowners I deal with -- I tell them the complete truth and I never "blow smoke up their wazu" by painting a rosy picture of the short sale process.
As soon as ALL of the paperwork is gathered we will submit to lender immediately -- they will typically acknowledge receipt in 4-6 weeks. In another 4-6 weeks after that they'll order an appraisal -- they will typically acknowledge receipt of the appraisal in another 4-6 weeks after that. Within 4-6 weeks of acknowledging the appraisal they will begin negotiating -- they will typically come to the table with their final offer in 4-6 weeks after that. Once we have the final offer, closing will take place in 4-6 weeks:
= 24-36 weeks (6-9 months)
My team will handle everything and there will be nothing for you to do. If the bank asks for additional documentation from you/your wife we will contact you -- the quicker you can get it to us the better.
Typically the collections department has no clue that the negotiations are in process with the short sale department and they may continue to call you weekly. When you tell them that a short sale is being negotiated they will tell you that they have no record of a short sale negotiation and you should send them the paperwork. They will be telling you the truth -- the collections department will have no clue that a short sale negotiation is in process and no matter how many times you tell them they will not put it into their system and they will continue to act as if nothing is in process -- the bank departments rarely talk to each other. Don't be worried. This is typical. Just let my team do its job. If you get any correspondence from the lender, or the court, fax it to my us, so we have a copy for our file.
Expect to hear from weekly even if there will be absolutely nothing to report.
Basically, sit back, and in 6-9 months from now we'll know if the bank is willing to do the short sale. Sickening, maddening, and crazy I know, but that's the way these banks operate and the banks keep the process to a crawl. For your own sanity, just put it out of your mind and rest assured we're working on it. If anything important happens we'll let you know. Nothing important will happen for months.
Yes, I'm brutally honest, but that's the way I operate. I tell people the truth!