what is a short sale, short sale


We’ve heard of people buying homes at low price through a short deal, but a lot of us don’t know wonder, what is a short sale? If you are on of those sitting on the sideline wanting to know what is a short sale, here is a brief explanation. A short home sale occurs when a home is sold for a lower price than what the home owes on the mortgage. The process is mostly used by homeowners to prevent foreclosure and for investors to buy a home at a very low price. If you are still wondering, what is a short sale? Let’s go a bit deeper into the transaction. Some homeowners, due to different circumstances, cannot afford their current mortgage and go into default on their home loan. They hear about short home deals and in the process of finding out what is a short sale, they also find out that the value of their home is a lot lower than what they owe on the mortgage, so even if the sold the home themselves, they would still have to cover the difference in the sale price. This is when an investor comes in and, with the intention of helping homeowners prevent foreclosure, offers the bank to buy the home at a low price in exchange for the deed to the home. The current homeowners get to dump their mortgage (stop making monthly payments) and the bank doesn’t have to deal with the costs of foreclosure. Sure owners have to sell the home, but that is a hundred times better than getting hit with a foreclosure.