Definition

By definition, a short sale is a real estate transaction in which the Seller’s debt,  when all  mortgage deeds, lines of credit, loans, taxes, escrow, title, commissions, etc., exceeds the agreed upon sale price of the property. When this occurs,  all lien holders  have to negotiate and accept a lesser amount that what they are owed. The result is a short sale, also known as a pre-foreclosure sale.
A Short Sale occurs when a negotiation is entered into with the homeowner’s mortgage company or companies to accept less than the full balance of the loan at closing, so it is  ‘sold short’. The Short Sale is an involved process that takes time, patience, good communication skills, organization and professionalism.

There are many other components necessary to complete a short sale and I will outline and define them in future articles. The short sale, since it has become  more prevalent in today’s market is  a much more dynamic and ever changing process. I am happy to report that more attention is being focused on these transactions and we can now expect to see a more streamlined process going forward. Please continue to search our growing archive and look for news updates explaining the changes as they happen.