Short sales can be beneficial for the buyer and the seller. The buyer purchases a property at a good price and the property owner can sell a home without being forced into foreclosure.
The downside, which frustrates everyone involved in the sale, is the long wait—sometimes months— for the financial institution to approve the sale.
Now that’s changed. Freddie Mac and Fannie Mae have established clear timelines for financial servers who work with government-backed loans. Servers must respond to a buyer offer within 30 days. The same timeline is applied for a distressed homeowner who requests short sale consideration. The new rule goes into effect June 15.
If more than 30 days are needed, servicers must provide the borrower and buyer with weekly status updates and come to a decision no later than 60 days from the date the seller’s Borrower Response Package or an offer from a buyer was received.
In the event a servicer makes a counteroffer, the borrower is expected to respond within five business days. The servicer must then respond within 10 business days of receiving the borrower’s response.
We are glad that finally we can expect a short sale decision within a reasonable time. Being able to short sell a house allows the seller focus on building a new life without the cloud of constant stress, while the buyer gets a good deal and helps the real estate market move along.