A short sale on a house is when a homeowner sells their property for less than the amount due on their mortgage. This usually happens when the homeowner is in financial distress and needs to sell the property before the lender seizes it in foreclosure. The lender must approve the short sale before it happens. The process can take as long as a year. Here are some key points to keep in mind:

For the seller:

• A short sale usually indicates a homeowner in financial distress, a real estate market in the doldrums, or both.
• Short sales allow a homeowner to dispose of a property that is losing value.
• Although they do not recoup the costs of their mortgage, a short sale allows a seller to escape foreclosure, which can be much more damaging to their credit score.
• The financial consequences of a short sale may be less severe than a foreclosure for both the seller and the lender.

For the buyer:

• Buying a short sale home gives buyers the opportunity to get a good deal on a piece of real estate.
• Short sale properties are sold “as is,” which means you won’t be able to negotiate a lower purchase price if there are problems with the property.
• Although the steps involved in a short sale process are very similar to a traditional deal, the process is more complicated because of the lenders involvement.
• The process can take a long time and often falls through.

Overall, short sales can be a good opportunity for buyers and sellers, but they can also be complex and time-consuming.