Short Sale Nightmare

Short Sale Nightmare

Glendale, AZ · Member since 2015 · 4 posts · 0 votes

Purchasing my first home and it happens to be a short sale. I'm trying to decide if it is still worth my time or if I should start finding a new home.

One lender: Cenlar (no 2nd) FHA Loan

Offer was put in on March 3rd, accepted by seller March 4th. There was roughly a 30 day delay from when the offer was put in until the seller submitted the short sale package to the lender. Cenlar received the package April 3. Everything seemed to be on track. By April 20th, we were told that the file is now on the final negotiator's desk. Then told that since the seller's middle credit score is 640, she was required to complete a loan modification (they claimed anything over 620 requires a variance). Was told everyone thinks its ridiculous since she is elderly and in a care facility and the variance should be easy to get sonce seller has documented health issues. May 5, was told Cenlar acknowledges seller's health issues. Did not hear a thing until June 3rd. Negotiator had been unresponsive. He says he is still working with the FHA regarding the variances. He said he has submitted a new variance to FHA that day and should hear something next week. Said our offer was excellent and approvable as soon as FHA agreed to the variances.File was escalated on June 5.

Have hear nothing until today (June 23). Case has been moved to supervisor's desk, surprise they are out until next Monday. 

Is there anything that can be done to speed this up?

How long does FHA usually take, I'm tempted to contact them myself.

Am I crazy for thinking this is ridiculous? 

Anyone who has comments or suggestions please let me know your thoughts. They are appreciated. Thank you!

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Mindy JensenPro Member
BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
11y

Short sales take as long as the bank feels like taking. I have not heard of anything that will make them speed up their process. Full price offers, over asking offers, nothing speeds them up. 

Are you in a hurry to be out of your current property, or are you just fed up with the process? A good real estate agent who is well versed in short sales should have told you this would take as long as it takes. I know many people who start down the short sale road and give up because it seems to take forever. The banks just don't feel any sense of urgency, which is too bad.

If you can wait, and it is a good deal, I would recommend at least doubling their timeline. You can get a fast short sale close, I suppose, but I have never heard of one happening before. Sorry this isn't a more positive response...

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  • Glendale, AZ · Member since 2015 · 4 posts · 0 votes
    11y

    Also, lease has ended. Living at my mother's house between tenants, but have to move again in 40 days. Will have to out everything in storage. It's been incredibly frustrating.

  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    11y

    Short sales take as long as the bank feels like taking. I have not heard of anything that will make them speed up their process. Full price offers, over asking offers, nothing speeds them up. 

    Are you in a hurry to be out of your current property, or are you just fed up with the process? A good real estate agent who is well versed in short sales should have told you this would take as long as it takes. I know many people who start down the short sale road and give up because it seems to take forever. The banks just don't feel any sense of urgency, which is too bad.

    If you can wait, and it is a good deal, I would recommend at least doubling their timeline. You can get a fast short sale close, I suppose, but I have never heard of one happening before. Sorry this isn't a more positive response...

  • Glendale, AZ · Member since 2015 · 4 posts · 0 votes
    11y

    Thank you for your reply. My agent told me it would take a while, but he also thinks its ridiculous how many bimps we've hit. We want to wait it out. I feelww e are so close to the finish line that i dont want to give up. Bank told us 60 to 90 days. It has been 90 days (120 since we put our offer in). I feel as soon as the FhA comes through, we'll get the approval. I just am getting antsy. Starting to think that waiting might not be worth it. BPO came back at our offer price. My problem is I've become emotionally attached to the house so I am not thinking objectively.

  • Michael BarbariPro Member
    Banker · Downers Grove, IL · Member since 2014 · 396 posts · 107 votes
    11y

    @Kelcie Grabill

    I am in the same process right now. I put in an offer 5/18. They just did the bpo last week. Now waiting to hear back. I put in a full offer but not sure if that matters. My condo is for sale as well. Good luck. Hang in there!

  • Rental Property Investor · Kansas City, KS · Member since 2014 · 604 posts · 222 votes
    11y

    @Kelcie Grabill - Like @Mindy Jensen said...short sales take as long as the bank wants them to. And it seems you've got it in spades since you're not only dealing with the bank, but with FHA. And when was the last time you knew of a governmental or quasi-governmental agency to work in a quick, efficient manner? ;) I'd say if you can hang in there, do it. Good luck!

  • Dawn BrenengenBusiness Member
    Moderator
    Real Estate Broker · Raleigh, NC · Member since 2014 · 2k+ posts · 1k+ votes
    11y

    @Kelcie Grabill

     Do you have a short sale facilitator involved?  In my area, there are attorneys who specialize in negotiating short sales, and I find they can get approval within 30 days or so, and close shortly afterwards.  Amazing difference between having them involved and not.

  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    11y

    The listing agent apparently is not the best. FHA has a very specific process. The buyers should have been a qualif and received an AuthorizationTo Participate, prior to listing, let alone priori to submitting a contract. They're doing it backwards, but it does seem they are near the end.

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