Patty Manzi’s Tri-Valley Real Estate Blog

I get asked this questions several times a week and the short answer is that there is no exact time-frame. Whether you are buying Pleasanton Real Estate or anywhere else in California, every short sale is unique, therefore, the time lines to complete the transactions are unique.

Some short sales can be completed within 90 days, some can take up to a year. Why the big difference in time?  To answer that question, you need a little education on the process of a short sale.

When a contract on a short sale property is negotiated between a buyer and seller, the contract is then forwarded to the bank (sellers  lender) for approval.  That approval process can take weeks or months.  Typically with large banks there is a specific protocol that must be followed.  There is a list of documents that must be submitted with the purchase contract.  Account numbers & sellers names must be printed on each page (some banks require the sellers signature on each page), then the whole package needs to be faxed to the bank.  It can take anywhere from 7 -21 business days for the fax to be ‘digitally imaged’ into their system.  Once that is completed, the file can be opened and viewed by the short sale department.  After the file is opened, it need to be reviewed and assigned to a ‘negotiator’ which takes an additional 7 – 21 business days.  Once the negotiator has the file, they have another 7-21 business days to contact the sellers agent to start the process of determining whether they will accept the buyers offer.  So in reality it could take 3 months or more just to get the offer in front of the negotiator before any actual negotiations take place.  And if there is more than one lender in the transaction, that will take even longer as the 1st lender has to negotiate with the 2nd lender (and maybe even a 3rd), before determining if they will approve the short sale.  During this time the listing agent will be on the phone daily or weekly getting updates on the process, and depending on hold times, these calls can take hours.

If you are considering a short sale (on either side) it would be wise to select an agent that you feel confident will take the initiative to follow up consistently with all parties to the transaction, and make weekly, or sometimes even daily phone calls to the lending institutions for updates.

So the long answer is that short-sales can take a very long time, and in some cases even after all the waiting, there is no guarantee the bank will accept the offer.  But in the end, it can be worth the wait – if you have the time & patience to wait.