Fewer than three of five short sales actually close in the state of California, according to a survey conducted by the California Association of Realtors.
The group found that agents had a great deal of difficulty dealing with mortgage lenders and loan servicers, with 70 percent describing the process as “difficult” or “extremely difficult.”
More than half of Realtors said lenders took more than 60 days to return a written response of approval (or disapproval), and in some instances it took longer than six months to hear back.
“Many underwater homeowners who have been hit by the recent economic crisis can no longer afford to stay in their home and just need to sell their home as expeditiously as possible are unable to largely because of the complex and cumbersome short sale process,” said C.A.R. President Beth L. Peerce in a statement.
“The lack of standardization, long approval process, and lack of lender approvals are hampering what should be a 45-day short sale process,” she added.
Peerce noted that the results show the short sale process “is clearly flawed and must be standardized and streamlined to reduce the inventory of foreclosures.”
Of those surveyed, 94 percent had participated in a short sale transaction during 2010, demonstrating the abundance of such listings in today’s real estate market.
If you’re thinking about bidding on a short sale property, understand that there’s a decent chance it’ll fall through, and if it is approved, it’ll probably take quite a bit of time to close.
But if you’ve got the time and the patience, you could snag a good deal.