a – The property has to be on the market at least 3 months before the lender will even look at a short sale offer
b – The purchase offer on a short sale has to be accompanied by the required documentation package that the sellers must need to fill out. (Financial statement, proof of hardship, tax returns, w2 etc…)
c – The lenders I have worked with respond within 6 weeks, to a short sale offer.
Section c usually is the driving reasons why buyers agents hate to submit offers for short sales.
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Most lenders servicing loans for distressed homeowners I have worked with, seem to give a somewhat random answer as to when the notice of default will be recorded. There seems to be this sort of ether that occurs from when the loan is actually passed to the loss mitigation group for notice of default recordings as well as the initiation of foreclosure proceedings. More of less it appears to me that the timeframe is approximately 3 consecutive missed payments. Although it could be more… which would seem obvious if the loss mitigation groups are flooded with work.
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Sakina99 make no mistake about it, you will have to move someday. Your landlord of course will want you to stay and rent up to the day they close escrow with the buyer, or the day they hand the keys over to the bank because you are essentially making his payment for him. If you keep the home clean and showable then all the better for him. You are essentially doing him a favor. If your landlord has not missed payments then you are in good shape. However if they have missed 3 payments then I would start looking. Most people do not miss 3 payments then start paying again. Once they stop, they have a new strategy and will move forward with it because it is essentially throwing more money away and prolonging the inevitable. So that is what you really need to find out, are they missing payments. Once a notice of default is recorded you have a little over 3 months, (closer to 4) unless your seller cures the default.
As a renter who has had to move 3 times in 2.5 years, twice due to landlord decisions, I would advise any tenant to be wary once the landlord puts a home on the market. Especially if they are behind in payments. I don’t like doing any favors for landlords selling their homes and I don’t like to subject my family to agents showing the home I am living in so the second I was told they were selling I left. I am especially happy to see the home I left in February is still on the market today. That landlord begged us to stay.
Sakina99 I am not saying something is imminent… but I would be willing to bet that within 9 months the home will have a different owner.
