I just found this post on RISMedia that describes a still disappointing and frustrating process:
Of course, lender communication has always been a key difficulty in handling short sales, exacerbated by agents on both sides of too many transactions who have no idea how to work a short sale. Lenders -- notably major banks -- have spent a lot of time working to improve their processes to accomodate the huge number of borrowers in default and to comply with recently announced HAFA guidelines. This new article confirms the reality that little has actually changed in practice, and the writer is pessimistic about real resolution.
Austin and Central Texas have been spared the worst effects of the recession and housing crisis, but we are not immune. Defaults and foreclosure postings are up, and the need for successful alternatives to foreclosure is real. I have been involved with conference calls recently with B of A, Wells Fargo, and others where they described their new streamlined procedures and systems, but success still requires knowledge and a methodical approach on all sides, including sellers and buyers who are properly prepared by their real estate agents.
Last year should have been the worst of the subprime mortgage crisis, but this year the bulk of Alt-A and Option ARM loans will reset, so there is a whole new wave potentially as big as last year's. With that knowledge and last year's experience, and with all the incentives for lenders to accomodate challenged borrowers with loan modification, forebearance, short sale, or deed in lieu, it is a shame that this remains so difficult. More reason for homeowners and lenders to work with agents and brokers who have invested the time and energy to gain experience and specialized training to handle these transactions.