Everyone has heard the term “short sale”, but not everyone truly understands what it is and how it works. To be very, very general, a short sale allows you to sell your home even though you owe more than it is worth.
So, the question is, "What is a Short Sale"?
In a short sale, the amount owed to the lenders is more than the home can be sold for. In a typical situation, the home owner would need to bring in the difference owed in order to sell the property. A short sale is different… In a short sale, we negotiate with the lender to accept less than the full amount owed to satisfy the debt, allowing it to be paid off “short”.
In a short sale, all of the fees involved with selling a home are paid by the lien holder (bank) and there is not any out of pocket expense for you (the seller).
By accepting the short sale, the lender is able to avoid the lengthy and costly foreclosure process, and the client is able to save their credit from a public record.