What is a Short Sale

A short sale means that the seller does not have enough money to pay off the existing loan on the property at the point of sale. (Example, the seller owes $350,000, but the sale will yield $320,000) This is sometimes called “upside down.”

The seller is short because the mortgage holder will get less than the mortgage amount when the property is sold. The seller is “short of cash” to cover the debt. In this case, the mortgage holder has a say in how much of a loss they are willing to take.

If a seller can pay the entire mortgage amount, plus whatever closing costs are attached to the sale, then the seller is not short. The seller may have lost equity, but not more than the amount still owed.

A seller can be short, but not in foreclosure. That seller has been paying the mortgage monthly, but cannot pay off the whole mortgage and closing costs upon sale.

NOTE:  Banks approve of the Short Sale process because banks will save TWO to FIVE times the cost of a foreclosure.  

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Short Sale Is Far Less Damaging Than Foreclosure 

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 1.      A short sale on its own does not challenge most security clearances.

 2.      A short sale is not reported on a credit report and is therefore not a challenge to employment

 3.      In some successful short sales it is possible to convince the lender to give up the right to pursuit deficiency judgment against the homeowner

 4.       In a properly managed short sale the home is sold at a price that should be close to market value and in almost all cases will be better than an REO sale resulting in lower deficiency.

 5.      A homeowner who successfully negotiates and closes a short sale will be eligible for a Fannie

 6.      Mae backed mortgage after only 2 years.

 7.      Only late payments  on mortgage will show on credit  report and after sale mortgage will be reported as paid or negotiated.   This will lower the score as little as 50 points if all other payments are being made..

 8.      A short sale’s effect can be as brief as 12 to 18 months

 9.   A short sale is not reported on a credit history.  There is no specific reporting item for “short sale”.   The loan is typically reported “paid in full, settled”

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Qualify for a Short Sale?

The home is worth less than the unpaid balance due the lender

You have a monthly shortfall that has caused a default on your mortgage or you will be going into default soon.

The seller is experiencing a hardship.  Some hardships are:

Health Issues
Rate Increase (ARM loans)Predatory LendingDivorce or Separation
Death In Family
Overextened 
Job loss
Reduced Income
Two Homes
Declining Market (UPSIDE DOWN)Pre-Foreclosure - (Behind on Many Payments)
Too Much Debt
Business Failure
Military Service
and more...

There are many factors to consider when considering selling your, get the advice of a Certified Distressed Property Expert.

We can assist, 
CONTACT US ASAP,
the clock is ticking.