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One of the biggest draw backs for a short sale is the amount of time it takes to get approval from the banks servicing the loan(s). In extreme cases it can take over nine months to get an loan approved for a short sale. During that time, properties can be vandalized, buyers can lose interest, and every other possible thing that can go wrong inevitably does.
Finally Some Accountability
Recently, the Federal Housing Finance Agency (FHFA) released new guidelines intended to shorten the short sale decision making process and hold servicers accountable for lack of timely responses. It has been my experience that many employees negotiating short sales on behalf of investors like Fannie Mae and Freddie Mac are overwhelmed with the amount of files they are asked to maintain and do not have the ability to meet the current in house guidelines set by the banks themselves. However, because they were internal guidelines that were not published, they were not closely followed. This has created an environment of that does not allow for negotiators and processors to be held accountable for their lack of attention to the files they are responsible for.
Short Sale Decision in 60 Days
The new guidelines attempt to clamp down on the current lack of urgency demonstrated by lenders. The new guidelines require the following:
- review and respond to requests for short sales within 30 calendar days from receipt of a short sale offer and a complete borrower response package;
- provide weekly status updates to the borrower if the short sale offer is still under review after 30 calendar days;
- make and communicate final decisions to the borrower within 60 calendar days of receipt of the offer and complete borrower response package.
The biggest and most important guideline is the final one. Servicers must provide a final decision on the short sale within 60 days of receipt of the offer.
This is an exciting time for real estate in the Arizona market. Whether you are a buyer looking to find a great deal or a homeowner that needs to relocate, the new guidelines will help everyone. We are here to assist in anyway we can.
To sit down with an experienced real estate attorney at the Wells Law Group, call (602) 903-2765 today. We offer a free consultation to homeowners seeking answers concerning their distressed real estate. [/fusion_builder_column][/fusion_builder_row][/fusion_builder_container]