Short Sale Differences – Financing and Appraisal Timelines
As with the timeline of the due diligence period, we generally try to stipulate that the buyer’s financing and appraisal contingency timelines will start upon the receipt of written short sale approval from the seller’s lender. We do this because until we have approval from the lender, we are not certain when the closing date will be, which makes it difficult and sometimes costly to lock a rate with the buyer’s lender as rate locks expire after 30 days, 45 days or 60 days respectively. Until we know when the closing date will be, we can’t lock our rate. Likewise, we don’t want our buyer to have to pay an appraisal fee of several hundred dollars on a property until we know that the bank has approved the deal, so our appraisal contingency timeline does not start until we have the bank’s written approval either.