It may be intentional but not for the reasons you state at all. Think about it in this manner…. Loan servicing organizations and such have been losing money in a big way in the past few years right? So they are getting hammered on the books AND they have exponentially more work for departments that used to be pretty much miniscule correct? So they don’t have enough staff, nor do they have money or time to staff up these departments. They have already laid off loan processors during the transitional period a few years ago when the business slowed but the deluge of foreclosures began. So the end result is they are ill equipped to handle the volume.
Finally there are not many loans insured by PMI when compared to the overall volume. Also I am not so sure that a PMI claim will be denied on a short sale. I am not an expert in the field but someone who actually works in a loss mitigation group would be well suited to comment.
Actually there is no mystery about a short sale. They can be a boon to any buyer but most buyers are not prepared to deal with them both emotionally and practically. Most people do not understand that you cannot just find a short sale, make an offer on it and get into escrow. Nothing actually starts on a short sale until your offer is accepted by the lender. Once accepted then things start however that acceptance takes anywhere from a few weeks (rarely) to a few months (much more common). I have a short sale listing that god willing will close in a few weeks and another short sale where I am representing the buyer that also will hopefully close in a few weeks. Both have been quite a burden.
Now there is NO DOUBT AT ALL, that an REO is much quicker and alot less work. Short sales are more work but no they are not a complete waste of time.
