Realtors Still Hate Short Sales

It really is sad that the mortgage industry and Realtors can’t seem to get along and process short sales quickly and effectively.

From the banks’ standpoint, short sales bring in more money than foreclosures.  From the Realtors’ standpoint, short sales represent aggressively-priced listings (usually).

But according to the California Association of Realtors, short sales are not getting an easier.

 And Realtors in California should know a thing or two about short sales, because 1 in 5 sales there is a short sale.  The latest C.A.R. survey on short sales reveals the following conclusions:

  • More Realtors (77%) described closing a short sale as “difficult” or “extremely difficult” than late last year (70%).
  • Realtors cited communication issues as the most frequent obstacles.  These include: lenders’ slow response time to a short sale package (cited by 66% of respondents), poor communication with lender representatives (55%), and repeated requests for documentation (51%).
  • 15% said that the lender foreclosed on the during the short sale process.
  • In terms of lenders’ response time, 67% said it took more than 2 months for lenders to provide a written response to a short sale contract.  43% said it took the lender more than five days to provide any form of communication.  Less than 20 % said lenders responded “within one business day” or less.
The survey was a follow-up to a survey done in December 2010.

Interestingly, 78 %  said they were “not likely” or “not at all likely” to refer buyers to the lender for future home purchases.  I wonder if lenders are aware of this…Realtors are a huge source of business for banks, so wouldn’t they want to make life easier for them?

According to C.A.R. President Beth L. Peerce,
“Despite promises by lenders to improve their short-sale processes, clearly, they are not doing enough.  Instead of helping struggling homeowners who need to sell and willing home buyers who want to buy, lenders have created man-made roadblocks that have caused real estate gridlock and hindered a desperately needed housing recovery.”


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