Short sale information

3 Reasons it takes so long to buy a Short Sale…

A Short Sale can take a long time in Eagan MN

Short Sales take a Long Time to Complete

Short Sales are anything but short, actually they take a long time.   A short sale means the Seller will be ‘short’ of enough money to pay off their full mortgage balance.

All mortgage balances need to be paid in full to pass on a clear title to the new buyer. Enter, the short sale.  The sellers’ own mortgage company agrees to accept an amount short of what they are owed and release the lien on the house.  The process takes anywhere from 4 to 12 weeks and sometimes more.

There are 3 main reasons the process takes so long.

1. The Seller’s mortgage company will do a thorough analysis of the Sellers’ current financial hardship before making a decision.  This analysis includes lots of paperwork from the Seller.  Quicker progress can be made if the Seller has everything ready, or turned into the bank at the time of the offer.  If the Seller does not have a clear hardship, a short sale may be denied.

2. Many Seller’s have two mortgages, a First Mortgage and a Second Mortgage.  This further complicates the process because both Mortgage Companies must agree to settle for less than they are owed. Second Mortgage companies can hold up the entire shortsale if they refuse to agree with the very low amount offered to them.  I have seen First Mortgage companies offer the Second Mortgage company $2000-$4000 to settle a loan balance of  $40,000 or more.

3. Understaffing at the mortgage companies forces the files to wait for weeks and weeks before they are reviewed.   A mortgage company needs to expand their space, hire staff, buy computers, invest in software, and train employees to accommodate the number of short sale requests.  The problem is, designing and creating a new, Short Sale department costs lots of money and the entire department exists only to lose money.  It’s no wonder mortgage servicers haven’t rushed to expand.

When considering a short sale purchase, ask your agent to find out if the Seller’s Hardship has been recognized by the bank, if the paperwork has been submitted, how many mortgages are on the home and most importantly, ask if the Listing Agent is CDPE certified and how many Short Sales they have completed.

As always, you are welcome to contact me if you need assistance negotiating a Short Sale purchase.

Merry Christmas and Happy New Year!
Tempor placerat pid penatibus eros facilisis rhoncus magna non sed dis risus. Ac ut! Vel vut enim porta lectus est habitasse egestas in. Augue dapibus odio! Rhoncus porttitor scelerisque sagittis, elementum magna, vut scelerisque enim elit parturient dignissim platea vel nascetur porta lacus mid odio, in ut, rhoncus, platea etiam enim quis integer placerat, mid, natoque, non scelerisque non!
Santa Claus
Turpis dis amet adipiscing hac montes odio ac velit? Porta, non rhoncus vut, vel, et adipiscing magna pulvinar adipiscing est adipiscing urna. Dignissim rhoncus scelerisque pulvinar?
Nisi mus sit lectus, velit tincidunt? Aliquam. Adipiscing a duis, enim purus dis, etiam odio auctor sed pulvinar proin dolor. Egestas dolor ridiculus elit lacus nunc quis aliquet. Aliquet et. Nunc et, tristique amet sagittis integer magna.
Please enter your name & email address to subscribe to our newsletter.