Short Sales: Taking longer and growing in numbers

Short Sales: Taking longer and growing in numbers

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SALT LAKE CITY -- Frustration is mounting among buyers, sellers and real estate agents as short sales take longer and become increasingly difficult.

Once taking as little as 30-45 days, real estate agents tell KSL Newsradio the process now takes anywhere from three to seven months, and in one extreme case: 15 months.

"It's real demasculating," says Aaron Sharp.

Sharp worked in construction and had five homes on his hands when the economy turned sour. Two of those homes he has sold through short sales. Another was a deed in lieu of foreclosure. A fourth Sharp lost to foreclosure.

"What kind of started me in the spin was obviously the decline in the mortgage market, but it was also last summer I had three of them come vacant. One of them I had to do a lot of work on to make it rentable, with money that I didn't have," Sharp says.

His short sales were massive headaches. One took close to five months to complete.

"You get an offer in, and then it takes a month to a month and a half for the bank to get back to you on that offer," Sharp says. "By that time, the buyer's gone."

It's an experience many people are going through in today's poor economy. The Salt Lake Board of Realtors says one in six homes listed in Salt Lake County right now is a short sale: a home for sale at less than what is owed on the current mortgage.

Some real estate agents say understaffed and overloaded mortgage companies and banks are a big part of the problem.

"We've heard from loan negotiators who have said they will get 100 new files on their desk each day, and they just can't keep up with that influx of new business," says Alan Jones, a Realtor for Prudential in American Fork who has specialized for eight years in short sales. "They're not going back and forth. The file is usually sitting on somebody's desk and being ignored."

In one case, Jones heard from a worker at one national mortgage company she had 600 filings she had to get through in 30 days. He believes many offers are simply discarded.

Other complications with short sales include changing ownerships and policies in the mortgage industry and third-party appraisers. Jones says third-party appraisers are a recent, positive development that negates fraud but adds to the time delay.

"My advice is simply you've got to be very patient," Jones says. "It's just going to take a lot of time right now."


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