In order to prevent foreclosure, a homeowner must first learn what the Hawaii short sale process entails. Not all banks or lenders are equal, some banks are much quicker than others but on average the time the offer is sent from the listing agent to the bank, Short Sale Realtors can expect to hear back between 45 to 90 days for the bank to respond.
* Some lenders, however, will take no longer than 30-45 days for the whole short sale process and some lenders may take more than 90 days.
Typical Short Sale Timeline
Day 1-15
The short sale processing company receives information from the listing agent and the seller. If a complete package, including purchase agreement and preliminary HUD-1, is received, the process is started with the lender(s).
Day 16-30
Lender receives full packet and file goes into rotation to be assigned a negotiator. Once a negotiator is assigned, a Broker Price Opinion (BPO) is ordered to help the lender determine the property value.
Day 31-45
Once the BPO has been completed and returned to the negotiator, they will have 15 – 30 days to review the file and determine if the offer on the property is in line with their Market Valuation (BPO). If the offer is accepted by the lender, the file is forwarded on to the investor/MI company (if necessary). If the offer is rejected, they will return with a counter offer.
Day 46-60
The investor/MI company either returns the file as an approved file, giving authorization to close, or they will return the file as a denied file and require a counter offer. If the file is approved, the approval will only be good for about 30 days.
Day 61-90+
If a counter offer is received, the investor can take another 15-30 days to review. If the counter offer is accepted, an approval will be granted and closing will be possible. There are times when the investor will refuse a second counter offer and the file will either be closed until a new offer is received or the investor may decide to take the property to auction through a foreclosure.
* One thing a seller needs to keep in mind when doing a short sale is that a new buyer generally will restart the process over again.