Short sale properties take a lot of time to close. Most lenders are backed up for months on Short Sale Packets and Loan Modification Request. If you are planning on buying a short sale home in AZ, make sure you can play the waiting game. The time frame to receive a response from a bank on a short sale averages 4-6 weeks. That’s if the listing agent has already ordered a Broker Price Opinion on the property. If no BPO has been ordered and no Short Sale Packet has been submitted by the owner, then a response time can take as long as three months. Unless the owner has spoken with the Loss and Mitigation department and requested short sale assistance, it is unrealistic for a buyer to contract this property within a reasonable amount of time. This is why Realtors advise clients to stay away from short sales. There’s too many other properties on the market to even consider short sales at this time. If you are lucky enough to receive a response an asset manager in charge of the short sale, they could decline your offer.

I should also mention Short Sales are properties owners are selling for less than what is owed on the home. Most short sales average a 60% Home to Loan Ratio, which means the lender is at a 40% loss if they do short sale the home. Short sales are better than bank owned homes in that, the buyer may request items to be fixed or replaced in the property. Bank Owned homes, are As-is. Meaning the lender will not make ANY repairs on the home.

Bank Owned Homes are properties that have already been foreclosed and bought back by the bank. These homes are ideal for buyers because the asset managers for these homes can turn a contract within 72 hours. If you are a cash buyer, the property can close as fast as the title company can execute the title. This usually takes two weeks, but can be done in a sooner time frame if the lender has already executed the deed.