Chase Bank just approved a short sale when they were in the 2nd position and only asked for 10% of the balance. This is a departure from last years 25%. Could it be that they have seen the light.

Chase continues to be the hardest bank to deal with on short sales. Because they are large they believe they don't have to make wise business decisions for themselves by approving short sales specifically when they are in 2nd position. Despite this we continue to get these sales completed.

Almost all lenders are working on short sales however Navy Federal Credit Union is not cooperating with owners and agents on "Short Sales". This is the consensus from many Realtors who are working on these transactions. Our recent experience confirmed this as they wanted the seller to pay back the entire note after the close. When we said no, the wanted an 80k note paid back after close of escrow. Of course this is ridiculous considering it was a purchase money loan and they would not get one dollar from the owners if it were to go to foreclosure. Additionally they had not filed a NOD after several months and need to wait at least 4 months before they could foreclose.

Short sales should be called long sales. The average timeframe from list date to close is 6 months. We just closed two today and both were 7 months. Our long has been 9 months with the quickest 35 days. Lenders have been trying to shorten this with little effect.

Unfortunately yes in some situations. If you have a 2nd loan that is an equity line or you have refinanced to pay debt or remodel the lender may have the option of coming after you after a foreclosure. This is why you should talk to a professional who can help you avoid this situation. When we get an approval on our short sale this is taken care of first.

Lenders are looking for a change in economic circumstance that is preventing their borrowers from paying their mortgage. We have learned that if you talk to someone long enough they will tell you that there is something that did not go as planned. Life has a way of doing that. All our customers have valid reasons and our getting approved. No one anticipated market values dropping 30% to 50% in Riverside and San Diego. We did not plan on more that 50% of available mortgages being eliminated in the last 6 months especially hurting the 1st time buyer. We also didn't plan on not being able to refi off neg am loans that increases our mortgage balances every month.

We just heard that Ocwen Mortgage has a new policy regarding short sales. They now say that if you don't qualify for loan modification they may consider a short sale. Is this just talk or is it real? Stay tuned. We are going to find out because we have clients who are beginning this process.

The eventual approval of a short sale is predictable but how long it takes is the frustrating question for sellers and buyers. The timing has a lot to do with who is the lender. Almost all lenders are understaffed and the quality of personnel is low as there is little experience in these departments. The processing time is now between 2 to 5 months. About 50% of the time the first buyer will cancel from frustration and a feeling that these "Short Sales" will never get approved. An experienced agent can prepare for this but at the end of the day the lenders will take as long as the need. They are not organized for quick results even though it is costing them millions of dollars.

Today most lenders are working with owners on short sales. Ocwen is the only lender that is not doing short sales. I wonder what their investors are going to think when the property sells one year after they could have sold it via a short sale.