I regularly meet with sellers contemplating a short sale and often times the first question is “How long will this process take?” Many have heard horror stories of short sales that have taken 9 months to a year to complete. In today’s short sale environment we are seeing short sale time lines greatly reduced by the efforts of some lien holders, Fannie Mae, Freddie Mac and other government efforts. Agent proficiency also plays a role is shortening the timeline. Working with an experienced short sale agent is key. Don’t be afraid to ask the agent you are interviewing what short sale experience they have.
Personally I have seen the average “days on market”, which is the time from when the listing went on the market, got an offer, got short sale approval, got buyer’s loan done and then closed, shorten. In 2010 my average “days on market” for a short sale was 179 with the quickest short sale listing sold in 87 days and the longest 298 days. So far this year that timeline has gone down dramatically. This year my average “days on market” was 116, with the quickest closing in 57 days and the longest at 192 days. You can definitely see an improvement in the average time lines over a 2 year period.
Here’s what a seller should expect in today’s short sale environment….
Listing to Offer – This timeline is greatly reduced in most price points due to low inventory levels. This is typically taking about a week for most properties.
Offer to Short Sale Approval – With most lien holders this process should not take more than about 60 days. There are some lien holders that take longer. If you are working with an experienced short sale listing agent they should be able to share their experiences with your lien holder and help to narrow the time lines. If there are 2 liens on the property this can also extend the time lines.
Short Sale Approval to Closing – this is typically 30-45 days depending on whether the buyer is getting a new loan or paying cash.
Many sellers face anxiety about where they will move and how much time they will have to find a new place to live. Typically once short sale approval is received the seller will have 30 days to move, which is typically the same amount of time a traditional seller has. As we progress through the short sale process we can typically give the seller an indication that we are close to the approval and that they should begin looking for a new place. Communication with your agent is key here.
If you are considering a short sale and want more information about the process and specifics for your lien holder contact me today.
