Understanding the Short Sale Process
A short sale happens when a homeowner sells their property for less than the amount owed on the mortgage, with lender approval. Because the lender must review and approve the sale, it typically takes longer than a traditional home sale.
Step-by-Step Short Sale Timeline
1. Hiring a Short Sale Expert (1-2 Weeks)
> Before starting the process, homeowners should work with a short sale expert to assess eligibility.
> The expert helps gather necessary documents and communicate with the lender.
> Learn more about short sale experts here.
2. Listing the Home for Sale (2-4 Weeks)
> The home is listed at a competitive price to attract buyers.
> Offers are typically submitted within a few weeks, depending on the market.
3. Submitting the Short Sale Package (2-6 Weeks)
> Once a buyer is found, the seller submits a short sale package to the lender. This includes:
> Hardship letter explaining financial difficulties
> Proof of income and expenses
> Bank statements and tax returns
> Purchase offer from the buyer
> The lender assigns a negotiator to review the case.
4. Lender Review and Approval (30-120 Days)
> The lender evaluates the offer, orders an appraisal, and negotiates terms.
> If there are multiple lienholders, approval may take longer.
> This is often the longest part of the process.
5. Closing the Sale (2-6 Weeks)
> Once approved, closing works like a normal sale but may take extra time due to lender conditions.
> The homeowner is officially released from the mortgage debt.
How to Speed Up the Short Sale Process
> Work with an experienced short sale specialist who understands lender requirements.
> Submit a complete short sale package to avoid delays.
> Stay in communication with the lender and respond to requests quickly.
Final Thoughts
A short sale can take anywhere from two to six months, depending on lender response time, market conditions, and other factors. While it requires patience, it can be a valuable alternative to foreclosure, helping homeowners move forward financially.
Recent Comments