In Real Estate, What is a Short Sale?

A short sale is one of the most popular words within the real estate industry today.  A short sale is generally the process that homeowners consider before a foreclosure occurs.  In a short sale, the homeowner contacts the lender to see if the lender would allow them to sell the property for less than the remaining balance.  Now, a short sale is not a quick process so if you are looking to sell your home in a hurry, and are not facing immediate or upcoming foreclosure, you may want to consider selling your home the traditional way.  Sometimes selling properties the traditional way, especially in today's market, seems virtually impossible, due to homeowners being upside down in their mortgages (owning more than their property is worth).  If your lender agrees or even considers the possibility of allowing you to short sale your property, be prepared to submit lots of paperwork.  They will want financial statements, a list of your current bills and payment amounts, all avenues of income, income tax documents, and they will want you to list the property for sale with a licensed real estate broker/agent.  Short sale approvals are taking anywhere from 60-90+ days so again, if time is of the essence, you may want to consider other avenues.  If you are person looking to purchase short sale property, know that your expected wait time, once you submit an offer to purchase, is about 60+ days.  The banks are inundated with short sales offers, on top of foreclosure properties so the wait time is sometimes unbearable. Some people, who initially submit offers for short sale properties rescind their offers in the interim because the wait time has exceeded their patience.  Short sales can be beneficial in some ways but not so in others.  If you are unsure as to the process and feel uncomfortable with just dealing with an agent, seek legal counsel before commencing a short sale.