Despite new rules for Home Affordable Foreclosure Alternatives (HAFA) short sales that went into effect on February 1, real estate agents responding to a survey said short sale transactions are still taking too long.
A survey published recently by Santa Barbara, California-based property valuations company Equi-Trax reveals the majority of short sales are taking four or more months to complete, and Realtors say lenders are to blame.
Of the survey's 626 respondents, 53.6 percent said that in their experience, on average, short sale transactions take four to six months.
More than 18 percent said the transactions take seven to nine months, 7.3 percent said the process takes 10 to 12 months, and 2.6 percent said the process takes more than a year to complete.
Only 18.2 percent said it takes three months or less.
An overwhelming 56.8 percent said the greatest challenge in completing a short sale is lenders, while 2.4 percent blamed challenges on the clients. About the same amount of participants (57.6) said lenders need to shorten the time they require to complete short sales.
Around 14 percent of agents also said they feel borrowers need to be better educated about short sales.
But as servicers begin to get used to the new rules and implement them into their company processes, agents may see the length of time short sales take drop dramatically, and the number of short sales being completed rise dramatically.
A recent forecast by specialty servicer AMS Servicing said non-GSE residential short sale activity could increase 50 percent industry-wide over the course of 2011 and beyond, substantially altering the national loan-servicing landscape.