What is a short sale?

A short sale is a home owner that must sell, and who owes more on their home than the present value of the home. Since 2008 values have declined, and it is because of the overwhelming market changes, that many banks and lenders have become open to negotiate a short sale. Recent changes in corporate policy and the government policy have also improved the chances of getting a short sale approved.

What is a clearer definition of a short sale:

  • A homeowner is ‘short’ when the amount owed on his/her property is higher than current market value.
  • 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. A buyer closes on the property, and the property is then ‘sold short’ of the total value of the mortgage.
  • For homeowners to qualify for a short sale, they must fall into any or all of the following circumstances:
    Financial Hardship – There is a situation causing you to have trouble affording your mortgage.
    Monthly Income Shortfall – In other words: “You have more month than money.” A lender will want to see that you cannot afford, or soon will not be able to afford your mortgage.
    Insolvency – The lender will want to see that you do not have significant liquid assets that would allow you to pay down your mortgage.

Seem easy? Well it should be, but it is a complicated process that takes the expertise of experienced professionals. I hold the CDPE® as well as SFR Designations and am ready to identify all possible options and, when possible, assist in the quick execution of a short sale transaction.

If you have questions or feel you may qualify for a short sale, please contact me for a free consultation.

Understanding your options now could mean all the difference in the world.


Also – find below some links to some of the larger banks and information that they provide on the short sale process:

Bank of America

Citibank Website

Wells Fargo 


Make sure you find out as much as you can about what a short sale is, the options, and if it is in your best interest.  The above sites, and information should prove beneficial.  Please feel free to pass along, share and like if you would.

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