1) The Bank/Servicer. “Banks” are the most often cited reason for delay on short sales. Processing a short sale can easily be accomplished in one month, but some banks simply bungle files. They lose documents, they lose files, they re-assign files too often, or they never assign files to start. In addition, some banks are now using third party servicing companies to process their files which adds another layer of bureaucracy.
3) The Appraisal or Broker Price Opinion. The bank orders a valuation of the property to make sure that they are recovering an acceptable amount for the asset. Some banks are now using appraisals, but others still rely exclusively on a Broker Price Opinion (BPO) or multiple BPOs. If the valuation is not accurate, it could take additional time to convince the bank otherwise. That additional time could amount to a significant delay in processing the short sale.
5) The Seller. Sellers in distress can be their own worst enemy. They are often slow to provide the necessary documents for the short sale. Some documents have to be requested from third parties and take time to receive. Other documents must be compiled by the seller, like current profit and loss statements (if self employed), the financial statement, and the hardship letter. Often short sale sellers are so overwrought about their financial situation that compiling the necessary paperwork is very difficult for them. This can also add to delays.
The Edgewood Homes in Orcutt, CA, Market Update
The Edgewood Homes in Orcutt are a delightful collection of one and two story homes just west of Bradley Road and north of Union Valley Parkway, adjacent to the Oak Knoll neighborhood and St. Joseph High School. These homes are about a 20 minute drive to Vandenberg AFB. They were built in the mid to late 1980's and range in size from 1300 sq. ft. to 1800 sq. ft. The development includes a private park that is gated and for the use of residents only.
