There are probably a million (exaggeration) youtube videos of REALTORS talking about short sales when they open with: “Short sales should really be called Long Sales,” with a clever smirk. While corny, the logic is sound.
The word short has nothing to do with the speed and everything to do with the loan. When the proceeds of the sale do not cover the liens on the property, it has to be sold short.
Short sales take time. First, we must unqualify the borrower for the loan. We need to show the bank why we need to sell, and why the asset isn’t worth what is owed. There are numerous checks and balances, and there is not a standard of practice followed from one bank to the next.
With so many loan products, there are a lot of decision makers in the pie. Mortgage insurers, investors, and yes, even the federal government.
Each one of these steps takes time to navigate and with tens of thousands of new short sales being opened every week, there is a huge backlog at some banks.
So if you are buying or selling a short sale, be prepared to wait. I promise you, if you have competent people working on it, it will be well worth your time.