Understanding a Short Sale

Short sale is a term used to refer to various types of transactions, whether in finance or in real estate. In real estate, this refers to the sale of real estate wherein the amount of money received from the sale is smaller than the balance owed on the loan of the property. This simply means that the owner is allowing the property to be sold at a lesser amount, because of a property or mortgage loan.

Real Estate Agents

Generally, short sale transactions are taken care of by real estate agents. Essentially, the process of doing this kind of sale is the same. The main difference is that the amount is far less than what the property is worth, and there is often a waiting period of 120 days or more for the process to be completed.

The Process

A short sale transaction begins with the owner’s intention of doing a short sale. The owner has to contact a lender to discuss the sale. The owner is also expected to provide the lender personal information regarding their loan or mortgage, so that the lender can assess the property. The property is inspected, and a discussion with the broker is had, regarding the short sale and the amount for the property.