So here is a common misconception. The "size" of the blackhole that you are talking about is it's Swarzchild radius, which has nothing to do with where the mass actually is. Nearly all of the mass is compacted into a tiny volume at the center. The Swarzchild radius is simply the point at which anything that comes closer will inevitably fall into the center, and has no way of escaping. Black holes do form in finite amounts of time. An observer, or any mass, which is falling into the blackhole will not feel any different passing the "event horizon" which is roughly at the swarzchild radius. Life will continue basically as normal until tidal forces from the differential gravitational force on the part of his body closer to the center compared the parts which are further away rips them to shreds. It would not be so pleasant as watching the ultimate fate of the universe.