While it seems that many lenders are starting to figure out how to move their foreclosed properties in a timely manner, the short sale process is still like having surgery with no anesthesia for buyers & sellers alike. You'd think that with so many short sales on the market, lenders would have streamlined the process for approval or disapproval by now.
With so many borrowers looking to get out from under their mortgages, it is understandable that loss mitigation departments are incredibly busy while making sure their company's best interests are being taken care of at the same time. That being said...the short sale process is ridiculously drawn out, and something needs to be done to streamline it. It should not take 4, 6, 9 months or more to decide on a number that a particular property can be sold for. "Paralysis by analysis" or "Atrophy via inaction" seems to be as incurable as the common cold.
Dear Loss Mitigation Department,
The current owner of this property, 123 Xyz Street in Anywhere, USA, informed me today that your company is withholding approval of the short-sale contingent upon my client agreeing to a December 15 close date. Today being December 3, that would leave only 7 business days for my client’s loan to go through all of the stages of underwriting necessary to meet such a deadline. That is not only impossible, but unreasonable—bordering on the ridiculous—the inspection period of 10 calendar days doesn’t even start until you provide an acceptance letter to my client. Since it is now 2 weeks or so since you have started working on this file after it sat for a full month with no progress after bouncing from desk to desk for 3 more months, closing by the end of the year is very highly improbable. With the Christmas holiday period falling in the middle of the week this year (and the resulting loss of business work days), January 7 is a more reasonable closing date.
I would think that ABCDE, being one of the nation’s largest mortgage lenders, would be familiar with the processes and timelines that are needed from the time of contract acceptance on a home. With that in mind, it seems that your loss mitigation department would rather not see this home sell at this time. If that is the case, fine. There are plenty of homes on the market, and this one can wait for another buyer, who will undoubtedly offer less for it than my client is willing to pay.
My client is interested in the home, and would like to purchase it, but not with a ludicrous deadline. He is also tired of waiting around for your company to make a decision, which should have been made a long time ago—one way or another. He has authorized me to inform you that ABCDE has until Friday December 5, at 5:00 PM Mountain Standard Time to provide an acceptance letter with a closing date of January 7, 2009 or we will withdraw the offer.
Either sell it to us now with the January 7 closing date, or take your chances in a declining market. To have this property sit on the market any longer is an injustice to the home, the current owner, the buyer and to ABCDE, since it will in all probability not see another offer as high as ours in this market.
If there is any human factor alive in your company, please keep in mind that the seller has done everything that you & the other 6 case managers have asked over the past year while trying to get this home sold. The value of this home has dropped steadily during that time--in essence, your company is losing money by the minute (perhaps I should not be surprised at this non-chalant attitude towards getting things done, since your company has been hemmoraging money like a hemophiliac mosquito for the past 2 years anyway).
To sell or not to sell? That is the question. It is your choice--FOR GOD SAKES, MAKE ONE!