I am a real estate agent. With short sales, unless you are a patient person and can afford to wait, it will take time unless the property's short sale has already been approved. If so, it should say in the listing info that it is "approved". If you would still like to try for a short sale, look for one that does say "short sale approved" and then it might even say something about the list price IS the short sale price. I am seeing more and more of these. The fed gov't is trying to make banks behave and really help these sellers but that is a slow process. The biggest challenge has been that the banks simply are not staffed to handle the volume of need. Along with that, many people on the banks' staff on the front lines may not know anything about real estate. That really doesn't help. I hope this helps you understand the inherent problems a little. I am also working on a short sale for a seller-client and one for a buyer-client. The process isn't easy on either side.

Joel & Clark:

I LOVE your show; I always appreciate your advice and knowledge. Thank you!

In regards to your point of view about short sales, consider some additional info.

I am an engineer-turned-Realtor actively involved in educating myself on the short sale process and technicalities. My team and I specialize in selling short sales for distressed homeowners.

Short sales, like foreclosures, trend in different markets at different times. We all remember in 2006 the Stockton, CA area was "ground zero" for foreclosures and the multiple waves of foreclosures that have washed across the country since. Likewise, the short sale market has followed those same waves, in similar trends.

ONLY been in the past 4 or 5 months have banks embraced the reality of short sales; the truth that they can, in fact, accept short sales as a way of mitigating their losses; even avoid ever actually putting the losses on their books.

This new willingness on the part of the banks--or lien holders--is a result of the following:

- Current administration's effort and action to infuse the mortgage industry with money;

- Requirements set forth in TARP;

- Necessary passage of enough time that banks have finally "staffed up" and structured in order to deal realistically with massive volumes of short sales submitted every day;

- Reluctant acceptance by the Realtors to work through the job of negotiating a short sale for clients.

For most of 2008, I *strongly* advised our buyer clients against even bothering with short sales.

Due to the shift in how we do business and how the banks are currently viewing short sales, I now counsel my buyers who can be patient to consider short sales.

It is absolutely true that as a buyer, you need a Realtor who knows how to handle short sales, because you need to be counseled on what the real market value of the home is estimated to be. The seller of the home needs to be represented by an experienced short sale agent so that the whole transaction can be orchestrated.

Just remember, your offer MIGHT take 2, 3, or even 4 months to get a response. The more likely scenario is that 2 months will be the maximum, as banks are becoming more efficient at the process.

For those who are reading this and thinking, "Right, I have already waited four months..." I respond that you are one of those who made your offer as the sun was setting on the previous practices and ways of processing. You, too, will likely be responded to.

One other note of interest: I doubt that this has been discussed outside the REO/short sale business circles, but efforts are afoot by various companies who now provide REO/foreclosure sale processing platforms to (in the near future) also provide similar automated platforms to process short sales. This will DRASTICALLY change the way short sales are negotiated, and they will look very much like a conventional/REO transaction. You heard it here first!

I was reading an article in business week today that addressed the short sale market. Factors mentioned were that 1.) banks have some sort of mortgage insurance most of the time, so they may make out better letting the property go into foreclosure. 2.) if the owner is still making payments, the banks won't see any immediacy in letting the property go.

One thing I haven't been able to find much information on is whether buyers can inherit liens or other similar problems from short sales. Honestly, I don't see much benefit from going this route...