With short sales making up over twenty percent of all Boca Raton real estate listings, and over thirty percent of those listings under $400,000, it is time to answer some commonly held questions and misperceptions about short sales.
SHORT SALE MYTH #1: Short sales take 9-12 months and do not get approved.
This is the most difficult part of a short sale process for both buyers and sellers. The lenders are slammed with files and do not always respond promptly. And it is true that the lender will not look at a file without an executed purchase contract. However, I am finding that the process is becoming more streamlined and it is possible to get a response in a more timely manner. The average process is as follows: Once there is an executed contract subject to lender approval, the contract along with the sellers hardship letter, tax returns, bank statements and financial statements are submitted to the lender. It usually takes a couple of weeks for the lender to then open a file and assign a negotiator. The next step involves the lender sending out an agent to do a BPO (Broker Price Opinion). This is similar to an appraisal of the property. The lender will usually accept an offer of approximately 85-90 percent of the BPO value. The negotiator generally works with the file for approximately 30-60 days before we hear a response. Then of course if all is agreed to, there is another 30-45 days until closing. So in the best case scenarios it is a process that takes 3-4 months to close. And it can take longer, especially if the buyer becomes impatient and backs out. Then a new buyer has to be found, a new contract executed, and the process begins all over again.
I have successfully negotiated many short sales resulting in approval. The shortest was two months and the longest was approximately five months. I negotiate short sale approvals each and every day.
Please check back for the next post addressing SHORT SALE MYTH #2: You must be in default on your mortgage to successfully negotiate a short sale.
Gloria Singer is the Broker of Boca Expert Realty, a boutique Boca Raton real estate company with a focus on professional service and an unparalleled customer experience. Our select agents are amongst the top performing professionals in the field. Visit www.BocaExpert.com for information on Boca Raton, Delray Beach and Highland Beach real estate and to connect with an expert in the local market.