According to a February study conducted by Campbell Communications, only 23% of short sale offers that homeowners receive from potential buyers actually close. Many homeowners watch buyers walk away as months pass dealing with lender delays, lost paperwork, and unreturned calls. Another Campbell Communications survey in March of 2008 found the average time for a mortgage servicer to respond to a short sale offer was 4.5 weeks. By this February it had doubled to 9 weeks and is currently 9.5 weeks. It’s not all the lenders fault though. Inexperienced real estate agents who don’t turn in complete paperwork and make the necessary contacts are also causing holdups.
So the government is stepping in to launch efforts to simplify and speed up the process. The Treasury Dept. will detail a plan to streamline the process by providing standardized documentation, cash incentives to lenders and a moving allowance to homeowners. I hope they get this straightened out soon. There are a lot of buyers suddenly clamoring to find a home. Unless the $8000 tax credit is extended beyond December 1, there will be a lot of disappointed buyers missing out largely due to ineptness.
Understanding the process and communicating it with your client will eliminate a lot of headaches. Be sure to do your due diligence and stay on top of things.
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