What is a Short Sale

WHAT IS A “SHORT SALE?”

A short sale is one way, with the help of a knowledgeable Realtor, to relieve the financial strain on families due to changes in the housing market. The “nothing-down” 80/20 mortgages that were used to purchase a home over the last few years may have made sense at the time, but now the home may be worth less than what’s owed, due to declines in market values. Unfortunately, some owners can’t wait for the problem to resolve itself over time through property appreciation. They need to sell now, either because of financial hardship, a job loss, divorce, or because they need to relocate.

One option for a seller is a “short sale”. A short sale occurs when the net proceeds from the sale of a home are not enough to cover the seller’s mortgage obligations and closing cost, and the seller is unable to cover the difference. The Realtor’s job is to negotiate for the seller and show the lender that it is in the lender’s best interest to accept the short sale vs. foreclosing on the property. Since the short sale process involves a lot of detailed paperwork, problem-solving skills, and persistence, a homeowner should utilize a professional who understands the process. Some sellers think they can’t afford a Realtor, so they try to sell the home on their own. Many don’t realize that in a short sale, the lender pays the broker’s commission.

For more information or to confidentially explore a short sale option, please call Don or Kim Rose at Assist-2-Sell, Buyers and Sellers Realty (865) 675-7283.