It is when a property is sold for less than the value of the mortgage.

If you want to see alternatives to a short sale (or loan mod) visit www.911savemyhouse.com

For example
House purchased in 2007 for $300,000 with a $260,000 mortgage

House value now $200,000
Mortgage balance $250,000

If the home owner sold the house for $200,000 they would have to pay the bank $50,000 plus pay any closing costs or commissions (ugh!).

If they submitted a short sale offer to the bank, the bank may agree to sell the house for less than $200,000. However, the owner would not receive any of the profits (if there are any), but they would not have to pay any closing costs or commissions (ugh!).

There are some tax and legal implications of a short sale and those questions are best answered by your CPA and attorney.

Hope this helps.

Hello. This is a great question in our current markets. The short answer is that you agree to sell the home for less than what is owed normally in lieu of foreclosure. So if you were the homeowner, the first step would be to contact your lender and try to follow the steps necessary to achieve a successful sale.

In addition, you should consult an attorney prior to making a final decision on the process. The bank of lender may delay the process and in the end you may never be able to put the deal together. There are a number of requirements to actually qualify for the short sale and you want to make sure that you research all of your options.

As stated above, a short sale is when a homeowner sells his/her home -- with the banks approval - for less than what they owe on the mortgage at no-cost to the home owner. In some cases, certain banks are even paying the owner $3,000 to $25,000 or so for relocation costs. I helped a client short sale his home and the bank wrote home a check for $20,000 at closing. In California, when a bank agrees to a short sale, they are prevented from suing the owner for the difference after the short sale goes through. I wrote an article on the ezinearticles website called, "Short Sale Your Home -- 5 Tips For a Successful Transaction" You can read the article here: http://ezinearticles.com/?Short-Sale-Your-Home---5...

Thanks,
Nicolas Romo
www.sellingcasas.com

A short sale is the process of selling one's property for less than the amount due the lender.

Short sales own your personal residence can usually tax forgiving for the purpose of being insolvent. The fact that a short sale was giving shows that the person was insolvent at the time of the short sale.


For more information on short sales go to http://www.buyersofcharlotte.com/short-sale.htm