What is a Real Estate Short Sale?
Q: So what is a short sale?
A short sale, by definition, is the sale of a property to a lender for less than the amount of the mortgage owed. The bank or lender takes into account current economic outlooks, the personal financial situation of the debtor or home-owner, the local real estate market, and the reasonable possibility that the bank will recover some, if not the entirety, of the mortgage loan.
Q: What are the advantages of a short sale to the debtor(me)?
The advantages of short selling a property to the debtor are obvious. A short sale is often pursued instead of foreclosure proceedings. Thus, by short selling a property, a debtor can keep a foreclosure off of their personal credit history. Also, the difference between the original mortgage and the short sale offer, also known as the deficiency balance, is partially under the control of the debtor.